The Three Biggest Retirement Planning Mistakes I See All the Time
Release Date: 04/15/2026
Why Not Put Your Entire Retirement into 5.25% Treasuries? (Have You Won the Game?)
The Power Of Zero Show
Is putting your entire retirement planning strategy into 30-year treasuries really the safe bet it seems? David McKnight reveals why this approach could expose you to two hidden risks, and explains how the stock market and annuities might hold the real key to protecting your income. In this episode, David McKnight looks at whether putting your entire retirement portfolio into 30-year treasuries is the way to go. While it may seem like a pretty compelling argument, there’s a major problem with this strategy – and it comes down to two things: taxes and inflation. The U.S....
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Dave Ramsey’s 8% Retirement Rule: What Could Possibly Go Wrong?
The Power Of Zero Show
Dave Ramsey says retirees can safely withdraw 8% a year from the stock market, but does his retirement planning math actually hold up? David McKnight breaks down why Ramsey’s approach overlooks a critical risk, and why annuities may be the missing piece to sustainably boosting your retirement income beyond the traditional 4% Rule. In this episode, David McKnight examines Dave Ramsey’s 8% withdrawal rate claim and why retirement planning may need annuities, and not just the stock market. For Ramsey, you can take 8% per year out of your stock market portfolio in retirement, despite what...
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The Three Biggest Reasons Americans Hate Annuities
The Power Of Zero Show
Most Americans hate annuities and would tell you to avoid them… But what if the version you’ve been warned about isn’t the only option for retirement planning? David McKnight breaks down a strategy that’s quietly helping retirees sleep better at night and safeguard themselves against the 3 biggest annuities-related problems. In this episode, David McKnight looks at three perfectly legitimate reasons why Americans have been reluctant to embrace annuities, as well as a solution. The first problem is liquidity. David points out that one of the biggest fears in retirement is...
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Should High Earners Contribute to a Roth 401k?
The Power Of Zero Show
Should every dollar go into a Roth 401(k) if taxes will be higher? David McKnight reveals why that instinct could actually be one of the most expensive tax decisions a high-income earner can make when it comes to retirement planning. In this episode, David McKnight addresses two frequently asked questions: “If tax rates are going to be higher in the future, should I be putting every dollar into a Roth 401(k)?” and “Should I be converting as much of my IRA to Roth as quickly as possible?”. David believes that the current tax rates are as low as we’re likely to see in your...
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The Latest Proposal to Tax Roth IRAs: Should you be worried?
The Power Of Zero Show
Should you stop doing Roth conversions as part of your retirement planning after Senator Ron Wyden’s new legislation targeting specific retirement accounts? David McKnight breaks down the key aspects of the proposal and what it actually means for the average American (and their retirement). Show Notes In this episode, David McKnight looks at whether you should stop doing Roth conversions following Senator Ron Wyden’s introduction of legislation for taxing Roth IRAs. For David, 99.9% of Americans should continue investing in Roth accounts with a high degree of confidence. One of...
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The Hidden Reason Married Couples Need Roth Conversions
The Power Of Zero Show
One spouse passes away, and suddenly the survivor is filing alone, pushed into tax brackets they never saw coming. David McKnight explains why a Roth conversion, done now through smart retirement planning, could spare your loved ones the painful surprise known as Widow’s Penalty. Show Notes In this episode, David McKnight discusses something that could cause your taxes to rise dramatically even if Congress never raises taxes by a single percentage point! That's the so-called Widow's Penalty, and it's a critical piece of retirement planning that too many people overlook. The U.S....
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What If I Retire Into A Market Crash?
The Power Of Zero Show
David McKnight addresses one of the biggest fears people have as they approach retirement: “What if I retire right into a market crash?”. Not only this represents one of the biggest challenges in retirement planning but it’s also one of the reasons why David advocates for protecting yourself from sequence of returns risk. When it comes to long-term stock market investing, it’s important to understand the difference between retirement years and accumulation years. Sequence of returns is the order in which market returns occur in your portfolio. That order, David stresses,...
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The Five Biggest Roth Conversion Traps
The Power Of Zero Show
In this episode, David McKnight walks you through the five biggest Roth conversion traps, and how to avoid them. He is a big believer in Roth conversions. Because of the apocalyptic fiscal trajectory of the U.S., taxes in the future are likely to be dramatically higher than they are today. Hence, every dollar you reposition from tax-deferred to tax-free at these historically low tax rates may be one of the smartest financial decisions you ever make. However, while many people understand Roth conversions in theory, they still get them wrong in practice – David has seen some very costly...
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High Earners: Stop Making This Roth vs. Traditional Tax Mistake!
The Power Of Zero Show
David McKnight addresses one of the most common questions he gets: “If tax rates are going to be dramatically higher in the future, shouldn’t I be putting every dollar into a Roth 401(k)?”. Moreover, people often wonder whether they should be converting as much of their IRA to Roth as quickly as possible. David is a firm believer that the current tax rates are as low as we’re likely to see in our lifetime. The U.S. has over $39 trillion in debt and it’s going to increase by two trillion per year over the next 10 years and over $200 trillion in unfunded obligations for Social...
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What REALLY Happens When Your Kids Inherit Your IRA
The Power Of Zero Show
In today’s episode, David McKnight discusses what many people don’t get about the IRS and what happens to their IRA and what their children are supposed to get at some point. Many people spend decades building up tax-affirmed retirement accounts without fully appreciating what happens when those accounts pass to the next generation. When a spouse inherits an IRA, they get the most favorable treatment under the tax code. In fact, they have options that nobody else gets - like the spousal rollover. David touches upon the so-called Stretch IRA, which he considers one of the greatest estate...
info_outlineDavid 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 are today.
The moment you hit age 73 or 75, Required Minimum Distributions (RMDs) kick in. In other words, the IRS is forcing you to take money out, whether you need it or not.
Those RMDs get combined with all your other sources of income: The taxable portion of your social security, your pension(s), and your investment income.
David notes that, before long, you can find yourself in a higher tax bracket in retirement than you were during your working years.
Remember, RMDs count as provisional income, which can cause up to 85% of your social security to become taxable – plus, it can trigger IRMAA surcharges on your Medicare premiums too.
Building a retirement plan that is almost entirely tax-deferred looks good on paper but leaves you entirely exposed to the impact of higher taxes in the future.
The second mistake is waiting too long to execute Roth conversions.
David touches upon the so-called “retirement income valley,” the ideal window within which to fully execute your Roth conversion.
Many people ignore it. They’re hesitant, reluctant to pay a tax to the IRS before it’s absolutely required of them.
Failing to take advantage of the “retirement income valley” puts you at risk of having your social security become taxable, while also paying higher Medicare premiums for the rest of your life.
When it comes to Roth conversions, David recommends having a “rip the band-aid off” approach.
It may hurt a little during the conversion period but once that money is in the Roth bucket, it’s tax-free for the rest of your life.
The third big mistake David sees over and over again is underestimating future tax rates and overestimating your control over them.
Most retirement plans today are built on the dangerous assumption that tax rates in the future will look a lot like they do today.
However, David stresses that looking at the fiscal trajectory of our country paints a different picture.
The national debt will grow by $2 trillion per year over the next 10 years, and $3 trillion per year after that.
With the rising interest costs and $200 trillion in unfunded obligations for Social Security, Medicare and Medicaid, there will be a financial day of reckoning where tax rates will be forced higher.
David predicts that to be around 2035 – which gives you around 10 years to plan and execute on your plan.
People spend their entire lives focusing on building as big a retirement nest egg as possible, but they give almost no thought to the type of accounts within which that nest egg is being built.
The lack of consideration for the tax implications upon distributions is a huge oversight, says David.
At the end of the day, the only thing that really matters in retirement is how much money you get to spend after taxes.
David concludes by highlighting that the best way to regain control over your after-tax income retirement is to pay taxes on it preemptively at historically low tax rates and on your terms (rather than on the IRS’ terms).
Mentioned in this episode:
David’s new book, available now for pre-order: The Secret Order of Millionaires
David’s national bestselling book: The Guru Gap: How America’s Financial Gurus Are Leading You Astray, and How to Get Back on Track
Tax-Free Income for Life: A Step-by-Step Plan for a Secure Retirement by David McKnight
PowerOfZero.com (free video series)
@mcknightandco on Twitter
@davidcmcknight on Instagram
David McKnight on YouTube
Get David's Tax-free Tool Kit at taxfreetoolkit.com