The Withdrawal Order Nobody Taught You (And How to Save 10% on Taxes Annually in Retirement)

Most retirement advice tells you to minimize your withdrawals. The actual move is to maximize the use of cheap brackets, which often means withdrawing more, not less, in your early retirement years. Yes, frugalities of virtue, but frugality at the wrong moment in the calendar is just an expensive form of virtue signaling, and the IRS is the audience that is clapping. Hello friends, this is Tyler Gardner welcoming you to another episode of your money guide on the side, where it is my job to simplify what seems complex, add nuance to what seems simple, and learn from and alongside some of the brightest minds in money, finance, and investing. So let's get started and get you one step closer to where you need to be. Quick note before we dive in. Which a lies pre-order incentive for my book Real Wealth is live, and this one is for the investors who are ready to go beyond the basics. Pre-order this month, tell me you did at TylerGardner.com/book, and I'll send you investing 2.0 beyond the foundation. A full hour video presentation on the five things every investor needs to know after they've mastered the fundamentals. Yours to keep delivered to your inbox digitally in early August. If you pre-order now, you're locked in for every monthly incentive through December. First, TylerGardner.com/book, now let's get into it. There's a question I want you to sit with before we get into anything technical today. If you spent 40 years saving, and you have, let's just say, $1.5 million distributed across a traditional IRA, a Roth IRA, and a taxable brokerage in what order should you spend it? First retirement content gives you the same three-word response. Taxable, traditional, Roth. Spend the taxable account first, and then the traditional 401k, save the Roth for last. It's tidy, it's repeatable, I certainly can endorse it, and it fits on a single Instagram carousel. It is the financial advice equivalent of Lather Rince Repeat. A phrase that exists more because it's satisfying to say than because it is, on inspection, correct for everyone. It also can be, for you, completely wrong. Not because the logic is bad. The logic is actually quite reasonable, but because the question itself is bad. The question assumes the only thing that matters is minimizing the tax bill across your retirement, and the question forgets that a retirement goes beyond the math problem. A retirement is a 30-year compound experiment in your life. Your taxes, your health, your spouse, your heirs, your moods, your relationship to time, itself. There's a passage in Wendell Berry, the farmer and essayist, one of the great American thinkers on the question of how a person should actually live, where he distinguishes between solving a problem and answering a question. A problem, Berry Rights, can be solved once. A question must be answered continuously, in the daily practice of being alive, often without resolution, and sometimes without even progress. The technical part of retirement is the problem. The withdrawal order is the question, you will answer it every year for the rest of your life, and I'm sorry, you will never solve it. So today we're going beyond the 1.0 of taxable traditional Roth, and we're going to the 2.0, and in my mind we're doing something much, much better. Welcome to part 2 of the D-Cumulation Series. Five parts, the series is a direct response to all of you who took the reader survey a few months back and told me almost in unison that the conversation everyone is having about retirement is the wrong conversation. You don't want more accumulation content, you want help with the part where you actually spend it. So today, the withdrawal order, the real one. What? why the withdrawal order is not what you think it is. I want to start with an idea that almost no creator in the personal finance space talks about, because it sounds a little depressing and it doesn't sell courses. It's this. The optimal withdrawal order changes every single year. I know how much you hate me right now. It's not depends on your situation. It's not varies by individual. It actively, structurally changes year to year because the variables that determine the right answer. Your taxable income, the tax brackets, the ACA subsidy cliffs, the Irma thresholds, the market's performance, your projected longevity, your spouse's health, the political composition of Congress and your own mortality table, none of those things hold still. A withdrawal order that was optimal in 2026 might be suboptimal in 2027. The decision is not made once in a vacuum. It is made every year for the rest of your life and anyone telling you there's a fixed answer is selling you the illusion of certainty in a domain where certainty does not exist. Welcome to life. You know this by now. This is the first thing I wish someone had told me when I started managing portfolios for other people. The withdrawal phase is not an algorithm. It's an annual decision making practice. The people who do it well. They're the ones who have built the habit of making the decision well one year at a time. For I know again, you hate me. 30 years in a row. There's a useful analogy here from gardening that I'm getting into a little more as I age. Just bear with me because I think it's the right analogy. A garden is not something you plan in February and then run for the rest of the year. It's something you tend. You watch what the soil is doing. You watch what the weather is doing. You watch what each plant needs this week. You make small adjustments constantly and you make them based on what's actually in front of you, not on what the seed packet said to do in February. The retirees who handle there withdrawal order well are gardeners. The ones who handle it badly are still working from the February plan in October wondering why their tomatoes are dying. The advice industry has trained you to want a final answer because final answers are easy to sell. The reality is that work is work every year forever. You're not solving a problem. You're tending a garden. Some years they're going to be storms. Some years they're going to be droughts. Some years everything just grows in its phenomenal and you sit on the porch and you feel briefly competent. The garden does not stop being a garden because you've decided you're tired of tending it. Okay, enough with the analogy and with that framing in place. Let's actually look at how to tend it. Part 2. The tax bracket topography most people never think about. Here's something most retirees have looked at 100 times and somehow never actually seen. Pull up the federal tax brackets. Married filing jointly, 2026. There's a 10% bracket from 0 up to about $25,000. Then 12% up to $100,800. Then 22% up to 211,400. Now, quick pro tip, slash reminder, just remember this is after the 2026 standard deduction which most people will end up taking. So your real gross income would be what's mentioned above plus 32,200 dollars as is the 2026 standard deduction. Now, most people look at these numbers and just see that, a list of numbers. What they don't see is the strategic terrain, the shape of the thing and how you could use it to your advantage. This is, I think, one of those moments where geography is a better teacher than math. If I gave you a topographical map of a mountain range, you would not look at it and see a list of elevations. You would see passes and ridges and cliffs and gentle slopes. You'd understand intuitively where you wanted to walk and where you didn't. That is exactly what a tax bracket schedule is, except that the financial industry has spent decades presenting it as a chart of numbers rather than a map of terrain. And the result is that most retirees walks straight off some cliffs they couldn't see but because no one taught them simply to look at the terrain. So here's the shape made as visible as I can make it. The 12% bracket is enormous. It spans roughly 76,000 dollars of income from married filing joint from 24,800 to 100,800 again, that's after the standard deduction. The 22% bracket above it is also enormous, spanning roughly 110,000 dollars. But the jump from 12% to 22% is a near doubling of the marginal rate. Ten full percentage points in a single step. The terrain at that boundary is not a gentle slope. It is a cliff, a specific, named geological feature of the US tax code that almost nobody draws on the map. That cliff, the transition from the 12% bracket to the 22% bracket, is, in my opinion, the most consequential tax feature in the entire United States tax code for retirees, and nobody talks about it. This episode is brought to you by Caldera Lab. Time for a quick confession. In high school, my AOL screen name might have been pretty boy-durden. That was my actual nickname, because while other guys were collecting baseball cards and playing real sports, I might have been collecting skincare products and taking my appearance embarrassingly seriously. The problem back then almost nothing was actually made for me. Everything was either borrowed from my mom's shelf or smelled like a department store had a mild panic attack, which brings me to Caldera Lab. They make high-performance skincare specifically engineered for men, and it's science-backed and clinically tested. The regimen is four simple steps that I love. The clean slate cleanser, the eye serum for when I look like I've been up writing YouTube scripts until 2am, because most likely I have been, the base layer moisturizer, and the good. They're best-selling serum with over 3.4 million antioxidant units per drop, and it's backed by real clinical testing, not just a share rate of marketing claims. 100% of participants said their skin looked smoother and healthier, and 94% said it looked younger overall. I use it every night, and I'm luckily at the point where the only sentient being judging me in the background is my bloodhound. Pretty Boy-Durden has been playing the long game since 1998, and consistency will always be quick fixes, both in skincare and in investing. So if you've been meaning to take better care of your skin, this is an easy place to start. Get to call dera-lab.com/tyler, and use code-tyler for 20% off your first order. That's called dera-lab.com/tyler. This episode is brought to you by Copilot Money. I have a group chat with four of my closest friends from my finance days. Between us, decades of managing other people's money, multiple licenses, and an embarrassing amount of opinions about actively managed funds. These are not people who download budgeting apps, these are people who tend to mock budgeting apps, and yet every single one of them uses Copilot Money. The group text now contains, between Bond Market Commentary and Bill's Game Updates, sincere love letters to a finance app. One text did last week, I finally feel like my financial life is in one place. That's from a guy who manages eight figure portfolios. Here's why people who actually know money land here. It tracks spending, net worth, investments, savings goals, and budgets in one dashboard, and it's beautiful to look at. Which shouldn't matter, but does when you're building a habit. It auto-categorizes transactions, it tracks subscriptions, so you'll finally find the streaming service you forgot about, and the gym membership you've been emotionally lying to yourself about since February. It works across iPhone, iPad, Mac, and Web. And best part, they don't sell your data. It's the only personal finance app to win an Apple Editor's Choice Award, an Apple Design Awards finalist, and it has 4.8 stars from over 28,000 reviews. So go to copilot.money/tyler, use code "tyler2" that's "tyler" and the number 2 for 2 free months. That's copilot.money/tyler. Here's what it means in practice. Every dollar of retirement income, you can keep under that 100,800 ceiling is taxed at 12% or less. Every dollar above it, including the very next dollar, is taxed at 22% or more. The marginal rate on dollar number 100,801 is almost double the marginal rate on dollar number 100,800. $2, waking up next to each other, going to completely different fates. One escapes the IRS at 12%, the next one pays 22% for the privilege of being a little later to the party. This is what I call a withdrawal cliff, and the strategic implication is enormous. In any given year, especially in retirement, you want to fill the 12% bracket to the absolute edge and not one dollar over if you can help it and if you can live that way. Every dollar of room you leave in the 12% bracket is a dollar you've handed back to the IRS in a future year because that dollar has to come out eventually and if it comes out in a 22% year, you just paid an extra 10 cents on it for no reason. I've watched retirees do exactly the wrong thing here. They begin retirement by living frugally. They've been told to be scared of sequence of returns. They've been told to only take out one or two percent of their assets, so they draw 50,000 a year from a $2 million traditional IRA. Then they feel virtuous about their discipline and then RMDs hit at age 73 and forced them into the 24% bracket, maybe for the rest of their lives. You might have left $50,000 of room in the 12% bracket for 10 consecutive years. That's $500,000 of taxable income that could have come out at 12% and is now potentially coming out at 22% or above. That's potentially over $50,000 in additional taxes paid for the privilege of being frugal at the wrong time. The optimal annual decision is not how little you can withdraw. It is how much you can withdraw to perfectly fill the cheapest tax bracket available to you. Some years that means draining the traditional IRA. Some years it means realizing capital gains in the brokerage. Some years it means converting traditional dollars to Roth dollars while you still have the room, especially if you don't need the money. It's a topographical question. There are the cliffs, where's the open ground, how do I move my income across the terrain so that I am always walking on the flattest, cheapest part. Part three, asset allocation, or how to put the right tool in the right drawer. I'm going to make this a quick segment because this is the kind of thing that gets confused constantly, and I want to clear it up before we go further. Asset allocation is the mix of stocks, bonds, cash, real estate, across asset classes in your portfolio. Let's say 70% equities, 30% bonds, that's how you allocate the money. Asset location is which type of account holds which asset. Bonds in the traditional IRA, stocks in a taxable account, international funds in a Roth, that's location, and so few retirees I know prioritize location. Location talks about allocation, and in retirement, location matters more than allocation, because the tax treatment of each account type interacts with the assets characteristics and weighs the compound over 30 years. A small, mental model that might help. Think of your three account types. Traditional IRA, Roth IRA, taxable brokerage, as three different drawers in a workshop. They're not the same drawer. Each has different lighting, different humidity, different access rules, and a serious craftsman does not throw every tool into the nearest drawer. The good chisels go in the climate controlled cabinet. The drill bits go in the magnetic tray. The lumber pencil goes in the apron because you reach for it constantly. The location of each tool is its own form of expertise, and the difference between a master shop and a hobby shop is not the number of tools it's where they live. Your portfolio is the same. Different assets belong in different drawers. The wrong asset in the wrong drawer doesn't fail visibly. It just costs you money, decade after decade. Here's the principle. The traditional IRA grows tax deferred, but will eventually be taxed at your full ordinary income rate. So you want to put assets that would otherwise be taxed at ordinary income rates anyway. IE bonds, which generate interest taxed as ordinary income, inside the traditional IRA. The traditional IRA is already going to be taxed at ordinary income on the way out, so putting bonds inside it is a tax rate wash with no friction. Meanwhile, the Roth IRA grows tax-free forever. Every dollar of gain inside the Roth never gets taxed again. So you want to put the highest growth assets you own inside the Roth. Equities, especially small cap or growth-tilted equities, belong in a Roth. The IRS will never see another penny of those gains. The Roth is the climate-controlled cabinet, put the precious things in the Roth. And the taxable brokerage account already gets preferential tax treatment on long-term capital gains and qualified dividends. 0% 15% or 20% tax brackets never your ordinary income rate unless sold short-term. So, broad market equity index funds which produce mostly qualified dividends and long-term gains if you hold the investments for over a year, belong in the taxable account. The wrong arrangement, equities in the traditional IRA, bonds in the Roth, growth stocks in the taxable account, cost the typical retiree somewhere between 200 and 500,000 dollars in additional taxes over a 30-year retirement. Same total portfolio, same total allocation, but different location, different outcome by up to a half-familian dollars. I'm not saying that to scare you, I'm saying that to nudge you into action. And just to be clear, that's the cost of a perfectly nice house in most of the country, paid by you to the IRS in exchange for storing your tools in the wrong drawers. If you take nothing else from this episode, just go look at where your assets actually live across your three account types and ask whether the location is doing the work. For most retirees, the answer is no. This episode is brought to you by Momentus. I've spent my professional life reading fine print, expense ratios, prespectuses, the footnote where they tell you what you're actually paying for. So it was genuinely humbling to realize I'd been taking a supplement every single day without ever asking what was actually in it. And I've always been fine aerobically. Swimming, running, walking a couple bloodhounds who actually tend to walk me, but as I got older, strength and recovery started mattering more. So I got serious about lifting and started taking creatine. It's one of the most research supplements there is supporting strength, power, lean muscle, recovery, even cognitive performance. The problem is that as the category exploded, most brands chased flavors and marketing instead of making the creatine itself better. Momentus went the other direction with signature spec creatine. It's manufactured in a pharmaceutical facility using reverse osmosis water purification, verified through a six-stage testing process with four independent agencies, 10 times fewer impurities, and two to five-time tighter heavy metal limits. Four independent agencies, that's not a marketing claim, it's how I know I actually trust it. And that's the momentous standard. And selfishly, the ultra fine powder actually dissolves, so I'm no longer chewing my morning drink. So if you want to try momentous signature spec creatine, head to livemomentus.com and use code Tyler for up to 35% off your entire first order. That's livemomentus.com promo code Tyler for up to 35% off livemomentus.com promo code Tyler. This episode is brought to you by Element. Heading into the summer, Element just dropped what is essentially their version of an Arnold Palmer. Lemonade iced tea. And I currently have a full picture of it sitting in my fridge. A little caffeine alongside the salt and electrolytes is exactly what I want after a long walk through the woods with the bloodhounds or in the late afternoon when I'd otherwise be reaching for a second cup of coffee that I don't actually need. But here's what makes this different from other energy drinks. Most energy drinks use synthetic isolated caffeine. Element uses full spectrum, organic black tea extract from Coreecho Kenya, 7,000 feet of elevation, so the caffeine comes with its naturally occurring, L-theanine and polyphenols. The result is steadier energy, less spike, less crash, and only 50 milligrams of caffeine per serving. Enough to matter, not enough to regret. Head to drinkelement.com/tiler, become an element insider, and you'll get four boxes for the price of three. That's drinklmnt.com/tiler. And even though I love this new flavor, this does nothing to diminish my feelings about mango chili and watermelon salt. Part four, the sequence of returns risk window and why order is everything. Sequence of returns risk, as you've heard me talk about before, is the technical term for the fact that the order in which your investment returns happen matters enormously in retirement. There's a useful way to think about this that I have stolen from of all places, the chemistry textbook, and I was terrible at chemistry. But in chemistry, there's a concept called path dependency. The idea that for certain reactions, the order in which you add the ingredients fundamentally determines what you end up with, same ingredients, same final amounts, different order of addition, equals different compound. You cannot make caramel by adding the sugar after the heat has burned the butter. You cannot fix it by stirring harder. The order was the recipe. Retirement returns are like that. If your portfolio returns negative 20% in the first year, and then positive 20, positive 20, positive 20, positive 20, over five years, while you're withdrawing 5% annually, you end up in a very different financial position than if it returns positive 20, positive 20, positive 20, positive 20, and then negative 20, over five years, while withdrawing the same amount. Yes, same average return, same withdrawals, wildly different outcomes, because withdrawing during a downturn at the beginning of retirement locks and losses on assets you needed to fund the rest of your life. Every retirement creator on the internet has covered this. I know that, but what none of them seem to talk about is the part that actually matters. The danger window is not symmetric. The first five years of retirement carry more sequence risk than the next 25 years combined. Not because the math is special in years 1 through 5, but because at year 5, you're withdrawal rate as a percentage of your remaining portfolio, either has dropped if returns have been good and you've left the principal intact, or has structurally shifted your financial life into a different category of vulnerability if returns have been bad. Let's say you retire with a million dollars and the market drops 30% in your first year. You're now withdrawing from 700,000 instead of a million. Your 50,000 dollar annual withdrawal, that was a 5% draw is now 7.1% draw. Bad markets in year 1 don't just hurt your balance, they restructure your withdrawal rate, often permanently. The implication that almost nobody draws out, during years 1 through 5 of retirement, you should be operating with an aggressively conservative cash position, even if it costs you long term returns. I addressed this specifically in part one of this series and if you didn't listen to that I'd suggest you go back and do. This contradicts standard advice. Standard advice tells you to stay heavily invested in equities to maintain growth over a 30 year horizon. The math of that is correct over 30 years, but the math of that is catastrophically wrong over years 1 through 5 if the market happens to drop in that window. Here's what that looks like in practice. Rather than holding the same 70-30 allocation throughout retirement, you could run a 60-40 in years 1 through 5, then increase your equity allocation back to 70-30 or even to 75-25 in years 6 through 15. Once the sequence risk has burned off, this is sometimes called the rising equity glide path, and it's the opposite of what every target date fund does. This is yet another reason I don't love target date funds. The target date funds decrease equity exposure as you age. The research that we've been over from Wade Fowell and Michael Kitzies, both serious academic finance people, neither of whom you've probably heard of unless you're deep in the weeds on this stuff, suggests that's exactly backwards. You should be most conservative when you retire, then as the danger window passes, and your portfolio either survives or doesn't, you can take on more risk again. Yes, it's counter intuitive, and yes, I believe it's correct. Part 5. The calendar question nobody asks. Here's a thought experiment I want you to take seriously for a moment. Your retirement early January, your first move is to fund the year ahead. You draw, let's say, $80,000. The question, do you draw it all at once on January 2nd or do you draw it monthly throughout the year? The default answer is monthly. It feels more orderly. It mirrors the rhythm of your old paycheck. It produces a stable cash flow. The personal finance industry loves that answer. But here's what monthly withdrawals actually do, mathematically. They mean that in any given year, roughly half of your 80,000 has been invested longer than the other half. The first month's withdrawal came out in January. The last month's withdrawal sat in the market until December. On average, your withdrawal money was invested for six months while in transit instead of zero months. Which means monthly withdrawals are equivalent to leaving an additional half year of withdrawal money in the market in expectation. On $80,000, that's $40,000 of extra market exposure. For 30 years of retirement, at potential 7% real returns, that affect compounds. The math says monthly withdrawals will outperform January 2nd lump sum withdrawals by roughly $50,000 to $80,000 of accumulated value across a 30 year retirement. But, and this is the part that has been completely under theorized. That's the math answer. The life answer might be very different. Because here's what monthly withdrawals also do. They keep you in psychological proximity to the market every single month. They turn every minor market dip into a question of whether to delay the withdrawal. They invite micro management. They make your relationship with money active when one of the goals of retirement that I've said forever is for that relationship with your portfolio to be passive. Meanwhile, the January 2nd lump sum approach has a hidden benefit nobody talks about. It gives you one financial decision a year. One day, one transaction, the rest of the year, the money is in your checking account or your high yield savings account, and you live your life without checking the market, without worrying about timing, and without thinking about your portfolio. For people who genuinely have the temperament for it, and not everyone does, the lump sum approach is actually superior on a life quality adjusted basis, even though it's slightly inferior on a pure math basis. This is the kind of decision the industry doesn't frame properly because the industry can only see the math. The math says monthly. Life often says yearly. Make the one that matches the kind of retirement you actually want, not the one you've been told by your advisor. Great passage in thorough, and I am, I realize accumulating literary references at a rate that suggests I have lost the room, but stay with me. Where he writes that the price of anything is the amount of life you exchange for it. The cost of a thing is the amount of what I will call life, which is required to be exchanged for it immediately or in the long run. The monthly withdrawal approach is mathematically superior by some five figure margin over 30 years. The lump sum approach to me is life superior. You exchange less of what the row called life, less attention, less worry, less of the mental real estate that a retirement is supposed to liberate for the same outcome. The row would have taken the lump sum. The row would also, I should imagine, have been quite difficult to retire with, but it's principal stands. Part six. The withdrawal order now that we have the framework. Okay. Now we can actually do the part everyone tries to do in 30 seconds. This is the decision tree and priority order for any given year of retirement. Step one, fill your low tax bracket capacity, no matter what. Look at your projected income for the year. Find how much room you have in the 12% federal bracket. For most couples, this is the space between your other income sources and roughly $100,000 bucks. Plan to use that room, always, every year. What you fill it with depends on the year's circumstances, which we'll get to, but the first principle is never leave 12% bracket capacity unused. It is the cheapest tax bracket you will ever have access to, and the IRS does not let you carry it forward to the next year. Step two. In the bridge years before Medicare, 62 to 65, if you retire 62, manage your modified adjusted gross income to maximize ACA subsidies. We covered this in part one, but if you can keep your modified adjusted gross income under certain thresholds, your health care premium subsidies are substantial, often 15 to 20,000 dollars a year in savings. This means in the bridge years under fill the 12% bracket, the few thousand dollars of additional tax you pay by leaving room in the bracket is dwarfed by the ACA subsidy savings. The taxable, traditional Roth question gets subordinated to the Medicare modified adjusted gross income question. But after age 65, that consideration drops away, as Medicare doesn't have ACA style subsidies and you can go back to filling the 12% bracket aggressively. Step three. Once basic income needs and tax bracket fill are handled, do Roth conversions with whatever capacity remains. A Roth conversion is when you voluntarily move money from a traditional IRA to a Roth IRA, paying ordinary income tax now in exchange for never paying tax on that money again. And any year where you have room in the 12% bracket and your past the ACA bridge, you should be converting traditional dollars to Roth dollars up to the bracket ceiling. We will dedicate it the entire episode to this next week. So I'm not going to go deeper here, but just know that conversions are the third use of bracket capacity after withdrawals for living expenses and ACA management. Step four, for everything that doesn't fit the above, draw from the taxable brokerage account first. The traditional advice survives at this point. Your taxable account in retirement is doing double duty, funding life and also being managed for tax efficiency through long-term capital gains realization and tax loss harvesting. Drawing from it strategically, rather than reflexively, preserves your tax advantage accounts for as long as possible. Step five, Roth is the asset of last resort. You know this, we've talked about it at length, so I will just leave it at that. That if you can afford to do so, the Roth is the single best estate planning tool to which you and your family will ever have access. Part six, the permission question beneath the question. I want to close with something that's not technical at all. And after that last section, yes, we can all take a quick breath. So with draw order question, taxable, traditional, Roth, ACA, modified adjusted gross income, Irma, Roth conversions, sequence risk, asset allocation, all of this on one level, technical. On another level, it is the question of how to develop the right relationship with your money that you spend 40 years not spending. The truth I've come to about this, after a lot of conversation with all of you, is that the technical question is almost never the real question. The real question is permission and the real question is a sense of security. Am I allowed to spend this? Have I earned it? What if I run out? What will my kids think? What does it mean about me as a person if I draw down 90,000 a year instead of 60,000? Those aren't really financial questions. Those are existential questions wearing financial questions clothing. I've watched retirees with $4 million plus in assets, agonize over withdrawing 80,000 a year. A 2% withdrawal rate, which any financial planner alive would call conservative. I've watched them stress test their portfolio against every imaginable downturn. I've watched them run Monte Carlo simulations on their phones at 2am. The technical work is meticulous. The technical answer is fine. The portfolio will survive. What's actually happening is that they spent 40 years learning to be savers and they don't know how to be anything else. The withdrawal order technically is taxable, then traditional, then Roth. The withdrawal order psychologically is permission than actual money. There's a line in Mary Oliver and yes, we are now leaning fully into the poets, which I suspect you knew was coming when you signed up for this season that I think about constantly in this context. Tell me. What is it you plan to do with your one wild and precious life? That question asked by Oliver in a poem about a grasshopper is the only question that actually matters not just in retirement, but right now. And it's the question almost nobody asks themselves with any precision. The Monte Carlo simulation at 2am is on some level a way of avoiding the Oliver question. The math and this has been true in my life beyond anything else serves as a wonderful distraction. The technical answer is your hiding place. That's part 5 of this series from saver to spender, but I want to plant that seed now. Now, because if you take only the technical content of this episode and leave that permission piece on the table, you might do the right math and live the wrong retirement. Yes, the technical work matters. The technical work is what this episode and the next two episodes will be about, but the technical work is in service of the larger question. What kind of retirement do you actually want? That the technical work cannot answer. So hold both, be ruthless on the math, but be generous with the permission. That's part two, though withdrawal order the way I'd actually teach it. To recap briefly, the optimal order is going to change every year. Anyone telling you otherwise is selling you certainty. You're not solving a problem, you're tending a garden. The 12 to 22% tax bracket cliff is the most consequential feature of the US tax code for retirees fill the cheap bracket every year. Don't be frugal at the wrong time because frugality, yes, it's a virtue, but frugality the wrong moment in the calendar is just expensive signaling. Asset location matters more than asset allocation and retirement. So look at where your assets live, not just what they are, the right tool in the right drawer. Sequence of returns risk is often asymmetric. So you'd want to be more conservative in years one through five, then increase equity exposure. The rise in glide path is the right shape. The calendar question, monthly versus annual withdrawals, is a life quality decision, not a math decision. Pick the rhythm that matches the retirement you want, throw would have taken the lump sum. The actual order when you do the work right looks like fill the cheap bracket, manage modified gross income in the bridge years, Roth convert with leftover capacity, draw taxable next and use the Roth last. And underneath all of it, the technical answer is in service of a life. Because tell me, what is it you plan to do with your one wild and precious life? This is part two of the art of decumulation. Next week, part three, the single most technically dense episode in the series. So bring a pen and if I'm being honest, a glass of something. We'll talk about Roth conversions, RMDs, and this pesky thing called Eurma that almost no one explains properly and that may well be the most punishing feature of the entire tax code. If this was useful, please consider sharing it with one person who's thinking about these questions. And as always, hope this gives you something to think about throughout the week ahead. Thanks for tuning in to your money guide on the side. If you enjoyed today's episode, be sure to visit my website at TylerGardiner.com for even more helpful resources and insights. And if you're interested in receiving some quick and actionable guidance each week, don't forget to sign up for my weekly newsletter where each Sunday I share three actionable financial ideas to help you take control of your money and investments. You can find the sign up link on my website, TylerGardiner.com or on any of my socials at social cap official. Until next time, I'm Tyler Gardner, your money guide on the side. And I truly hope this episode got you one step closer to where you need to be.