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At The Margin
Protect Your Retirement from Inflation and Rising Costs. This week in tmrw, learn how inflation compounds quietly, how long-term care fits into your financial future, and what it takes to retire with confidence in a changing economy.

Hi, Tom here.
Quick reminder: If you’re planning to retire in the next 10 years, don’t miss our upcoming Wealth Workshop on May 14 at 11 AM CT. We’ll show you how to build a sustainable cash flow strategy—one that supports your lifestyle, protects your portfolio, and gives you control in retirement.
This week, we’re looking at how inflation quietly erodes your wealth—and what you can do to stay ahead of it.
Let’s get into it.


The most dangerous threats to your retirement plan are the ones you barely notice.
This is a follow-on piece from last week’s post about your own economy. There was one theme in there that I mentioned I wanted to go deeper on this week:
Inflation.
After years of central banks trying to create it, here we are in 2025—doing everything we can to tame it. Groceries are up 21%. Cars cost 25% more. Home insurance premiums are up 17%. Affordable travel is becoming a luxury again. And if tariffs roll in like President Trump has proposed, your personal inflation rate could climb even higher.
So what gives?
Inflation isn’t just a headline or a policy issue.
It’s a hidden force that chips away at your freedom—slowly, steadily, and often invisibly.
When it comes to retirement planning, it’s not just another variable. It’s a core risk.
Because the goal of retirement planning isn’t just to grow your portfolio—it’s to sustain your lifestyle for 25 to 30 years or more. That means generating reliable income while preserving purchasing power over time.
And here’s the problem: inflation doesn’t feel urgent. .
Many people ignore it—until they’re shopping for groceries, insurance, or travel and wondering, “Didn’t this used to cost way less?”
A 3.5% inflation rate doesn’t sound dramatic. But compounded over 25 years, it quietly doubles your cost of living.
Inflation is dull and boring, but ignoring it could also be one of the most expensive mistakes you make.
Let’s break it down.
You may be familiar with the Rule of 72—one of the most practical tools in personal finance. It’s used for two simple things:
To estimate how long it takes to double your money at a given return
Or to find what rate of return you need to double your money in a set number of years
Here’s how it works in action:
Let’s say you have a $1.5 million portfolio and need to double it in 8 years before retirement. Using the Rule of 72, you’d need to earn a 9% annual return to hit your $3 million goal (72 ÷ 8 = 9).
But here’s the other side of the coin:
The Rule of 72 also shows how inflation can quietly erode your purchasing power. At just 3% annual inflation, your cost of living doubles in 24 years. That means if you’re spending $145,000 today, you’ll need nearly $290,000 in 25 years just to maintain the same standard of living.
That’s not hypothetical.
That’s your money being worth half.


Here’s what I wrote last week about inflation:
“No economy survives without healthy cash flow—and yours won’t either. In the 2020s, with elevated asset prices and persistent inflation, dialing in your spending and income is more critical than ever. A 3.5% inflation rate over a 25-year retirement can quietly erode your plan. While market returns are out of your control, your spending habits and savings strategy are not. Your economy runs on cash flow—manage it like a veteran CFO.”
That 3.5% figure? Let’s put it in perspective.
Let’s assume you and your spouse plan to spend $145,000 per year in retirement. That likely reflects a household earning between $200K and $250K today. You sit down with your advisor and start talking about inflation. Two scenarios come up:
2.25% inflation over your retirement
3.35% inflation over your retirement
You think to yourself, “It can’t be too different—that’s only 1.1% more per year.”
Until you run the numbers.
Retirement Year | 2.25% Inflation | 3.35% Inflation |
---|---|---|
1 | $148,263 | $149,858 |
5 | $162,063 | $170,970 |
10 | $181,134 | $201,592 |
15 | $202,450 | $237,698 |
25 | $252,901 | $330,468 |
Total Cash Needed | $4,903,511 | $5,721,841 |
That’s a difference of $818,330 over a 25-year retirement.
Or put another way: an extra $6,500/month in year 25 just to maintain the same lifestyle.
Turns out, inflations isn’t subtle.
It’s the margin between financial freedom and financial stress.
Now, here’s a financial planning threat with an inflation rate far higher than core inflation: long-term care.
Long-term care costs surged by as much as 10% last year alone—and that’s not a one-off. Roughly 70% of people over age 65 will need some form of long-term care.
This isn’t a fringe risk.
It’s a likely outcome—and one that calls for thoughtful, proactive planning, decades in advance.


What Got You Here Won’t Get You There.
If you’ve grown your wealth over the past 15 years and are now staring down retirement, here’s a quote worth keeping front and center:
“What got you here won’t get you there.”
The low interest rates, stable inflation, and massive gains from U.S. large-cap stocks that defined the last decade likely won’t repeat themselves.
Jason Zweig of The Wall Street Journal nailed this point last week in The Intelligent Investor. In his piece, “The Mistake You’re Making in Today’s Stock Market—Without Even Knowing It,” he explains how our “memory banks”—the returns and experiences we’ve lived through—shape our assumptions. But they can also mislead us.
Just because stocks or bonds behaved a certain way in the past doesn’t mean they’ll act the same way in the future—especially as the world changes around us.
Now is the time to challenge those assumptions and build a financial plan that’s ready for a different kind of decade—the one you’re likely about to retire into.
Just think about what life looked like 10 years ago. We weren’t driving cars that could drive themselves. We weren’t using AI to double our productivity. And we certainly weren’t battling inflation like we are now.
But some things haven’t changed—like the math behind money:
If inflation stays higher for longer—you can do the math.
If interest rates stay higher for longer—you can do the math.
If equity market returns are muted—you can do the math.
There are almost infinite variables at play when you open your Schwab account or review your tax return.
But one thing hasn’t changed: your ability to understand the basic math that affects the thing you’ve worked decades to build—your freedom to live life on your terms.
Knowing the math isn’t enough.
Awareness is the start—but real protection comes from action.
The next decade won’t play by the same rules as the last. And your financial plan shouldn’t either.
Here’s how to craft a retirement strategy that aims to bends without breaking:
Check your memory banks – the place you keep your sacred knowledge of your personal economy. Cautiously question it. Understand the things you believe to be true.
Revisit your spending plan and investment mix regularly. Don’t “set it and forget it.” You don’t live in a static world—your financial plan can’t either.
Consider short-term bond ladders to cover several years of living expenses. This can insulate you from inflation spikes and market drops.
Know how your income sources adjust for inflation. Social Security offers some protection, but most pensions do not. Are you investing in growing dividend equities? What types of fixed income make up your portfolio?
Plan for healthcare. Long-term care costs are rising faster than CPI. HSAs can help build a tax-advantaged buffer for the years ahead.
Pressure-test your plan—before the market does. Companies are forecasting earnings with and without tariffs. That’s not noise. That’s uncertainty you need to price in. If your plan hasn’t been reviewed under today’s conditions, it’s time. Clarity beats comfort when the rules are changing.
The math may change. But your ability to adapt doesn’t have to.
Inflation doesn’t announce itself—it creeps in, compounds quietly, and puts pressure on even the best-built portfolios.
You can’t avoid it—but you can design around it.
That’s why the most effective plans aren’t rigid. They’re resilient.
Flexible. Strategic. Built for optionality.
This isn’t about panic or prediction. It’s about protecting your freedom—on your terms.
Like I said last week: the most important economy isn’t the one in D.C.—it’s the one you’re running.
Your own.
Make it flexible.
Make it durable.
Make it worthy of everything you’ve built.


Two ways we can help you turn awareness into action:
BluePrint — Our flat-fee financial planning engagement. Designed for those who want expert guidance without a long-term commitment. We aim to deliver clarity, direction, and a tailored plan you can execute with confidence. Perfect if you’re looking for high-impact advice—fast. Let’s start with a quick conversation.
Bergen — Our full-service wealth management offering for individuals and families with $1M+ in investable assets. We’ll help design and manage a custom strategy built to reduce complexity, protect your lifestyle, and give you the freedom to focus on what matters most. Let’s talk.
Inflation is compounding. So are the benefits of getting your plan right.
Talk soon,
Tom

If your retirement expenses are $125,000 a year today, and inflation averages 3.5% annually, about how much will you need per year to maintain the same lifestyle 25 years from now? |


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