Protect Your Retirement: Rising Inflation & Jobless Claims

The hidden fee that eats retirements: inflation you actually feel

There’s a cost almost everyone underestimates, especially once the paycheck stops: the slow leak in purchasing power. Prices creep up. Paychecks don’t. And no, the sticker shock from 2021-2023 didn’t roll back. We’re in 2025 with rates still way above the 2010s norm and living costs that reset higher and stayed there. That combo is the fee retirees pay every single day, whether the S&P is green or red.

Why this matters now? Cash yields are better than the 0% purgatory of last decade, sure, but inflation didn’t go back into its box. Retirees feel the services side of inflation most, doctors, roofers, contractors, trips to see the grandkids, and those categories tend to run hotter than the headline CPI. Historically true across cycles, and still true. According to the Bureau of Labor Statistics, from 2000 to 2023 the Medical Care CPI rose about 110% while overall CPI rose roughly 78% (BLS CPI indexes). That gap is exactly what ruins neatly built spreadsheets.

Same story at home. The CPI category for household maintenance and repair has surged since the pandemic; from 2019 to 2024 it’s up on the order of ~30% by BLS measures, as skilled labor and materials both got pricier. And travel? Lodging away from home remains materially higher than pre-COVID; BLS data show hotel prices in 2024 running roughly 15-20% above 2019 levels, even with some volatility. You feel that on every vacation line item. Even when airfares cooled off from their 2022 spike, the base level didn’t fully reset.

Here’s the twist that catches folks: once wages stop, “price creep” hits harder because you’ve lost your built-in inflation hedge, raises, bonuses, stock grants. Markets can bail you out over multi-year windows; expenses compound monthly. It’s the asymmetry that stings.

Nominal vs real: a 5% portfolio return with 3% inflation is not 5%. It’s ~2% in real purchasing power. That’s the return you actually spend.

We’ll keep this practical. In this section of the guide I’m going to flag where planning typically goes off the rails, and how to adjust:

• Why price creep hits harder when paychecks stop: no wage growth to offset rising services costs, and withdrawals amplify sequence risk. Spend goes up even if quantity doesn’t.
• Healthcare and home upkeep inflate faster than CPI: historically, medical care inflation has outpaced headline CPI (BLS 2000-2023), and post-2019 maintenance/repair costs are up ~30% (BLS). That gap, not the market’s daily wiggles, is what blows up plans.
• What “real return” actually means: it’s the nominal return minus inflation and taxes. That’s the yardstick for safe spending, not the bold numbers on your statement.
• Cash-drag vs inflation-drag, the trade-off you really manage: parking too much in cash feels safe but can trail inflation; going all-in on risk assets courts drawdowns. The art is sizing the cash bucket to fund near-term needs while your growth sleeve outruns the sticky costs you actually face.

Quick reality check on rates: even with cuts discussed this year, money markets and short Treasuries have been paying north of 4% for much of 2025, which is great, until you line it up against your personal inflation basket. If your healthcare, insurance, HOA, and travel are running 4-6%, the real math is closer to flat. That’s the fee. It’s quiet, it’s boring, and it’s relentless.

I’ve seen too many plans assume “CPI + 2% returns” and call it a day. Fine in theory, but your life isn’t the CPI. We’ll anchor to the costs you actually incur and build from there, even if it means revising a few sacred cows. Better to be roughly right than precisely wrong, as my old PM used to gripe… and he was right.

Rising jobless claims: what they’re whispering to pre-retirees and recent retirees

I’m not trying to scare anyone; I’m connecting dots the way we do on the desk. When weekly initial jobless claims trend up, hiring slows, severance gets stingier, and market drawdowns get harder to ignore, those three together raise retirement timing risk. The Department of Labor has been showing initial claims hovering in the mid‑200,000s in recent months, up from the low‑200,000s for stretches last year, and continuing claims have been near ~1.9 million at points this summer, compared with ~1.7 million for parts of 2024. Pair that with unemployment drifting into the mid‑4% range in Q3 2025 (BLS) versus the mid‑3s last year, and you’ve got a softer labor tape. Not a crisis, but not the 2021-22 hiring boom either.

Why that matters for retirement math: layoffs amplify sequence‑of‑returns risk early in retirement because you’re forced to sell into weakness and you’ve lost paycheck flexibility. If you retire, or get retired, right before or during a drawdown, withdrawals from a shrinking portfolio lock in losses and reduce future compounding. It’s the dreaded double‑hit. Historically, cohorts that started in ugly years like 1968, 2000, or 2008 saw sustainable withdrawal rates drop about 0.5-1.5 percentage points versus benign start dates, depending on equity mix and the speed of recovery. That’s not theory; it’s the arithmetic of selling shares when prices are down, repeatedly, while you wait for the rebound that always takes a little longer than you want.

Bridge planning if you’re 55-64 and worried about a pink slip (yes, this is the moment for over‑preparation):

• Cash runway: move past the old 3-6 months rule. If job risk is rising and you’re within 10 years of retirement, target 12-18 months of core expenses in high‑quality cash/short Treasuries. If one spouse is still employed and stable, 9-12 months can work, but I still like 12.
• Severance reality check: many employers pay ~1-2 weeks per year of service, often capped. In softer markets, caps get tighter and discretionary extensions dry up. Don’t underwrite your plan on a hopeful package, model the low end.
• COBRA + healthcare bridge: COBRA typically runs up to 18 months; after that you’re into ACA marketplace plans. The enhanced ACA subsidies remain in place through 2025, which makes income management (Roth conversions, capital gains) a lever, not a footnote, if you want to keep premiums reasonable.
• Pre‑fund near‑term spending buckets: sweep 2-3 years of planned withdrawals into safe assets so you’re not a forced seller in a 15-25% equity drawdown. Think of it as a layoff/drawdown airbag.
• Adjust the glidepath: if equities are >65% and job risk rises, consider a staged de‑risk (say 5-10 points) into Treasuries/IG while your employment income is intact. It’s easier to do this before a surprise HR calendar invite.

When delaying Social Security is rational: I’m not doctrinaire here, cash flow is king, but the mechanics are straightforward. After Full Retirement Age (currently 67 for many), your benefit grows ~8% per year you delay until 70. That’s a guaranteed increase, inflation‑adjusted with COLAs. In a soft labor market, delaying can be the cleanest way to raise your floor of guaranteed income, which in turn lets your portfolio take less strain during bad sequences. Rules of thumb I actually use:

• If you have sub‑annuity‑level guaranteed income (no pension, small rental net), and your health/family longevity is average, delaying to 70 often pencils.
• If markets are down double‑digits when you hit 62-67, delay increases the odds your portfolio recovers while your future benefit grows.
• If you’re cash‑tight and would be drawing 5-6%+ from investments to bridge, consider a partial claim (one spouse files earlier, higher earner delays) to reduce portfolio stress.

Emergency liquidity targets when job risk rises (bigger, on purpose):

• Pre‑retirees (55-64): 12-18 months of essential expenses in cash/short‑duration. Add a separate 6-12 months for healthcare premiums if you’d face COBRA/ACA without employer coverage.
• Recent retirees (0-3 years out): 24 months of planned withdrawals parked safe, plus a standing line of credit (HELOC or securities‑based) set up while your income is still strong. You don’t have to use it; you want the option.
• Tax tools: fund HSAs if eligible; harvest losses to replenish cash without increasing AGI; use Roth contributions/conversions as future tax‑free liquidity (SECURE 2.0 keeps RMDs away from Roth IRAs).

One last point that sounds obvious but gets missed when nerves are high: match spending cuts to volatility, not to headlines. If claims keep trending up and your industry is wobbling, tighten variable spend and pause big capex (kitchen remodels love to appear at the worst time). You want to control the controllable, income timing, withdrawal rate, and guaranteed income, so a cyclical soft patch doesn’t morph into a permanent detour. I’ve had to talk clients off the ledge and, honestly, myself too a couple times, the plan works, but only if the cash buffer is real and the Social Security timing isn’t guesswork.

Quick stats to anchor the mood: DOL has continued claims near ~1.9 million at points in mid‑2025 (vs. ~1.7 million in parts of 2024), and BLS has unemployment around the mid‑4% range recently. Not recession signals on their own, but they do argue for a thicker cash cushion and a more deliberate Social Security strategy.

Inflation-fighting paycheck: buckets, TIPS ladders, and built-in raises

Inflation‑fighting paycheck: buckets, TIPS ladders, and built‑in raises

You don’t beat rising prices by hoping they cool; you design a paycheck that floats with them. Here’s the boring math that actually pays the bills.

Build the 3‑bucket stack

• Bucket 1 (1-3 years): cash and short Treasury bills. Think 12-36 months of core spending after pensions/SS, sitting in high‑yield savings, T‑bill ladder, or a short Treasury fund. With continued claims hovering near ~1.9 million at points in mid‑2025 (vs. ~1.7 million in parts of 2024) and unemployment in the mid‑4% range recently, I want this buffer thicker than usual. Headlines don’t pay rent; cash does.
• Bucket 2 (3-10 years): high‑quality bonds with a healthy slice of TIPS. This is your income bridge. If the Fed has to keep policy tighter, nominal yields help. If inflation stays sticky, TIPS do the heavy lifting. Real yields have been meaningfully positive this year, which is a gift for retirees who need inflation‑indexed income.
• Bucket 3 (10+ years): growth sleeve, global equities and real‑asset exposure. This is for future you, not next winter’s heating bill. Dividends grow over time, and earnings growth is the real inflation hedge over decades.

Quick macro gut‑check: DOL continued claims ~1.9M at points in mid‑2025, BLS unemployment roughly mid‑4% lately. Not panic, but a nudge to keep 1-3 years liquid and avoid heroic withdrawal rates.

TIPS ladder vs. TIPS fund: when you know the bill dates

If you have known liabilities, property taxes each December, Medicare Part B/D premiums quarterly, insurance in July, a TIPS ladder shines. You can buy individual TIPS to mature in each month/quarter you need cash so the principal and coupon are CPI‑adjusted. That’s liability matching. If I say “duration immunization”, sorry, habit, I just mean lining up maturities with your spending dates so price volatility matters less.

• Prefer a TIPS ladder when you want date‑certain cash flows and you’ll hold to maturity. It sidesteps day‑to‑day market swings.
• Prefer a TIPS fund/ETF when you want simplicity, broad exposure, and rebalancing ease. You’ll get CPI linkage but no date‑specific cash.

One nuance I keep seeing: people mix ladders for fixed bills (taxes, Medicare premiums) and a TIPS fund for the discretionary layer. That hybrid actually works.

I Bonds: inflation ballast with tax deferral

Series I Bonds are the quiet MVP for small, steady inflation insurance. Key rules matter:

• Purchase limits: up to $10,000 per person per calendar year electronically via TreasuryDirect, plus up to $5,000 extra via a federal tax refund in paper form. Titling matters, spouse, revocable trust, and certain business entities can each have their own limit.
• Tax: interest is federal‑taxable when you redeem (or at final maturity), state‑tax free. That deferral is real money over a decade.
• Liquidity: 12‑month lockup; redeeming before 5 years costs the last 3 months’ interest.

Use I Bonds as a slow‑build sleeve inside Bucket 2. They won’t fund next month’s HOA; they will keep chipping away at long‑run inflation with minimal drama.

Annuity with COLA vs. DIY TIPS ladder

• COLA annuity (lifetime with inflation rider): Gives guaranteed income as long as you live, with either CPI‑linked adjustments (sometimes capped) or fixed 2-3% increases. Pros: longevity insurance, simple paycheck, behavioral comfort when markets wobble. Cons: lower initial payout vs. no‑COLA annuities, rider costs, insurer credit risk (mitigatable by using strong carriers and staying within state guaranty limits), and illiquidity.
• DIY TIPS ladder: Pure CPI‑U linkage, you control maturities, and no insurer risk. Pros: transparent, usually higher expected real payout for a fixed horizon. Cons: no protection if you live well past the ladder end; you become your own pension manager.

Where it belongs: I like covering baseline non‑negotiables (food, housing ops, Medicare premiums) with Social Security plus either a modest COLA annuity or a TIPS ladder to age 85, then a deferred income annuity from 85+ as a longevity backstop. And yes, I just contradicted myself a bit, because the right mix depends on how much you value liquidity vs. sleep. If you hate complexity, lean annuity. If you want control and can live with some moving parts, lean TIPS ladder.

Dividend growth: supplement, not substitute

Dividend growers help fight inflation over decades, but they’re variable and market‑linked. They belong in Bucket 3 as the engine for future raises, not in Bucket 1 where the electric bill lives. Dividends can and do get cut in recessions, ask 2009 me, who thought “blue chips don’t cut.” They do. Use them as a raise factory over 10-20 years, not your December property tax payer.

Circling back to clarity: the goal isn’t to predict CPI next year. It’s to lock in the next 3 years with cash/T‑bills, secure years 3-10 with high‑quality bonds and TIPS, and let growth assets and dividend increases handle years 10+. That way if inflation runs hot, you’ve pre‑built the raise into the paycheck. If it cools, you still own a sane, boring plan. Boring wins. I learned that the hard way, spreadsheet bravado rarely pays the mortgage on time.

Guardrails for bad markets and layoffs: keep withdrawals from snowballing

Fixed 4% sounds clean until markets and the job market both wobble. When claims rise and returns get choppy, rigidity is your enemy. The playbook that works is a flexible one: start with a reasonable initial rate, then let the plan tighten or loosen with the portfolio and labor data, mechanically, not emotionally.

Pick a sane starting point, then add rails

I’m fine with a 3.6%-4.2% initial range depending on your mix and guaranteed income. Morningstar’s 2023 research pegged a base nearer 3.8% for a 30‑year horizon when you’re adjusting for inflation and sequence risk. That starting point matters less than the guardrails you bolt on. The Guyton‑Klinger framework (2006) is still my go‑to: give yourself spending bands and only adjust when the portfolio hits the rails.

• Ceiling/Floor rule of thumb: If your portfolio hits a new high watermark and is up ~20% from the last check, you can raise the dollar withdrawal by around the inflation rate and a bit more. If it’s down ~20%, cut the dollar withdrawal by 10% and pause inflation raises. It’s not perfect, but it’s simple enough to follow when your nerves aren’t.
• Guardrail check cadence: Run this annually, semiannually in rough patches. Don’t tinker monthly, you’ll just chase noise.

Prioritize what to trim, don’t turn off the lights

• First cuts: travel, gifting, home upgrades, and hobby splurges. Those can flex with the cycle.
• Last cuts: healthcare premiums and out‑of‑pocket, core housing (mortgage/rent, taxes, insurance, utilities). Keep these funded, even if it means a temporary haircut elsewhere.

Claims and returns: why the rails matter now

Labor is a signal. When initial jobless claims surge, layoffs follow and risk assets usually get jumpy. We’ve seen how fast it can move: weekly initial claims spiked to about 6.9 million at the peak in early April 2020 (DOL data). You don’t need a 2020‑level shock to feel it; even a drift higher from the ~200-250k “normal” range puts stress on households. Inflation whiplashed too, U.S. CPI hit 9.1% year‑over‑year in June 2022 before easing in 2023-2024. The point is simple: variable spending beats stubborn spending when conditions swing.

Sequence defense: tap safe buckets first

• Use cash and near‑term TIPS first in drawdowns. That’s your 1-3 year paycheck. If stocks are down 20% and claims are rising, you do not want to sell equities to fund groceries. Spend the cash/T‑bills and the TIPS rungs maturing in the next 12-24 months.
• Rebuild mechanically after rebounds: when equities recover and you harvest gains, refill the cash bucket back to target (e.g., 24-36 months of spend). Make it formulaic, “top up to 30 months when the portfolio makes a new 12‑month high”, so you don’t negotiate with yourself in real time.

One simple rule I use with clients: “No equity sales for living expenses when the S&P 500 is below its 200‑day average and claims trend higher.” It’s not perfect, but it kept several retirees from turning paper losses into permanent losses in 2022. Boring works. Boring wins.

How much to adjust

• Raise cap: annual increase capped at CPI or 3% (whichever is lower) unless the portfolio is above the upper guardrail. Then a modest real raise, say +1% real, is fine.
• Cut floor: if you breach the lower guardrail, reduce the dollar withdrawal by 10% and skip inflation for a year. If you breach again, repeat. It hurts less than it sounds because you’re cutting discretionary first.

Pre‑retirees facing layoff risk, set the table now

• Roth contributions = optionality: Roth IRAs lack RMDs and contributions (not earnings) can be withdrawn anytime. That flexibility during a layoff is gold when claims trend higher and offers are scarce.
• After‑tax brokerage cushion: Taxable accounts give you favorable capital gains rates and no early withdrawal penalties. In a pinch, harvesting losses can offset gains and ordinary income.
• Cash target: in uncertain labor markets, push emergency reserves toward 9-12 months (versus the classic 3-6). With cash yields around 4%-5% earlier this year, the opportunity cost isn’t brutal.

Reality check

I’ve seen the “set 4% and forget it” approach blow up right when people needed stability. Intellectual humility says accept that markets will do what they do and the job market will swing, your plan should bend with it. Same idea, said a bit differently: if you can’t control returns or claims, control your withdrawal rules. The rules do the heavy lifting when your gut wants to do the wrong thing.

Taxes in a higher-rate, higher-yield backdrop: convert, harvest, and bracket-manage

Taxes in a higher‑rate, higher‑yield backdrop: convert, harvest, and bracket‑manage

When cash and bonds finally pay you again, tax planning stops being an April chore and becomes a year‑round yield allocation problem. The goal isn’t the smallest tax bill in 2025. It’s the lowest lifetime taxes while keeping your purchasing power intact. With 5‑year TIPS real yields hanging around ~2%-2.3% across late 2024 and into this year, and money‑market/cash ladders paying ~4%-5% at points earlier this year, the “where” you hold assets matters as much as the “what.”

Roth conversions: use down markets and low‑income windows

• Gap years: A layoff, sabbatical, or pre‑RMD retirement window is prime time. Convert IRA dollars up to a target bracket (e.g., within the 22% or 24% federal marginal brackets that are still in effect under the TCJA through 2025). If markets are off 10%-20%, you’re effectively converting more shares per tax dollar.
• Age timing: The SECURE 2.0 rules put RMDs at age 73 for folks hitting that age in 2025. Converting before RMDs start reduces future forced income and those not‑fun bracket jumps later.
• Operational note: Withhold taxes from taxable cash when possible, not the IRA. Don’t shrink the tax‑free engine you’re trying to build.

Asset location: use the tax code to hike real return

• TIPS and higher‑yield bonds in tax‑deferred: TIPS phantom income and ordinary bond interest get taxed at ordinary rates if held taxable. Shelter them inside IRAs/401(k)s. With real yields ~2%, keeping those coupons untaxed until distribution meaningfully bumps after‑tax compounding.
• Equities in taxable: Qualified dividends and long‑term gains get 0%/15%/20% rates. That’s a built‑in discount. Also, equities in taxable preserve potential step‑up in basis at death.
• Roth for high‑octane growth: Put higher expected‑return assets in the Roth. The upside escapes taxation entirely, which is the whole point.

Tax‑loss harvesting: playbook without tripping over the future

• Know the limits: Realized capital losses first offset capital gains, then up to $3,000 can offset ordinary income each year (married filing jointly and single; $1,500 MFS). Excess carries forward indefinitely.
• Mind the wash‑sale rule: Avoid buying a “substantially identical” security 30 days before/after the sale. Use near‑substitutes (e.g., swap an S&P 500 ETF into a total‑market ETF) to keep market exposure.
• Don’t accidentally nuke your step‑up potential: Harvesting doesn’t eliminate the step‑up; it lowers your basis now, which can reduce the amount of future step‑up if you hold until death. So prioritize harvesting in positions you’ll likely trim within your lifetime, and keep legacy positions (the ones you intend to hold for decades) more intact. I’ve seen families grateful they left the 20‑year winners alone.
• One more quirk: Watch the replacement purchases in IRAs/Roths. A wash sale can be triggered if your IRA buys the identical security inside the 30‑day window, and that disallowed loss doesn’t adjust IRA basis. That one stings.

Social Security, RMDs, and IRMAA: avoid accidental bracket jumps

• IRMAA tiers: Medicare Part B/D surcharges are based on MAGI from two years prior. In plain English, your 2023 MAGI affects 2025 premiums. The first IRMAA threshold sits around the low‑$100k MAGI range for singles and low‑$200k for married filing jointly (exact numbers update annually). Crossing by $1 can increase annual premiums by hundreds per person.
• Sequencing: Consider partial Roth conversions before Social Security and before RMDs at 73 to keep lifetime MAGI steady. Sometimes delaying Social Security to age 70 and “filling” the 22%/24% brackets with conversions yields a lower lifetime tax bill even if it feels expensive in the moment.
• Qualified Charitable Distributions (QCDs): After age 70½, QCDs from IRAs can satisfy RMDs and keep MAGI down, handy for IRMAA and the 3.8% NIIT cliff. I’m surprisingly enthusiastic about QCDs, yes, that’s a sentence I didn’t expect to write.

HSAs: stealth retirement accounts for medical inflation

• Triple tax benefit: deductible contributions, tax‑free growth, tax‑free withdrawals for qualified medical expenses. Leave receipts to reimburse later if you want.
• 2025 limits: IRS HSA contribution caps are $4,300 self‑only and $8,550 family, plus a $1,000 catch‑up at age 55+. Invest HSA funds instead of spending them immediately if you can; medical costs tend to outrun CPI over time.
• Retirement bridge: After 65, HSA withdrawals for non‑medical uses are taxed like an IRA (no penalty). For medical uses and Medicare premiums, still tax‑free. That’s real flexibility.

Putting it together (quick map)

1. Set target tax brackets to fill this year. Use conversions to that ceiling.
2. Place TIPS/high‑yield bonds in tax‑deferred, equities in taxable, growthy things in Roth.
3. Harvest losses against gains; avoid wash sales; be thoughtful about step‑up candidates.
4. Model two‑year‑lookback IRMAA before you trigger gains or conversions, seriously, this surprises people every fall.
5. Max your HSA (2025: $4,300/$8,550); invest it; save receipts.

One last thing I haven’t even mentioned yet: pairing loss harvesting with a donor‑advised fund gift of appreciated shares can zero out gains while keeping your allocation intact. Not for everyone, but when it fits, it really fits. And yes, the paperwork is annoying, worth it anyway.

Insurance, debt, and the boring stuff that saves retirements in rocky years

Here’s the unglamorous cleanup. When jobless claims start ticking up and headlines get jumpy, the households that sail through have two things: liquidity and risk transfer. Not fancy, just done. I’ll start with cash and correct myself if I get too jargony. You want an operating buffer (day-to-day checking + 1-2 months of expenses) and a true emergency fund (another 4-6 months in a high‑yield savings or T‑bills). If you’re retired, push that to 12 months of essential spend so you’re not selling stocks after a bad quarter. Why not less? Because real people scramble: in the Fed’s 2023 SHED survey, only 63% said they’d cover a $400 expense with cash or equivalent, too tight for comfort in a choppy year.

Second, a HELOC as a backstop. Open it while your W‑2 income still prints nicely; don’t draw unless needed. Banks price HELOCs off prime, and prime was 8.5% for most of 2024 (Federal Reserve data), which made balances expensive. That’s exactly why we keep it unused until a true cash crunch. It’s about optionality. When markets are down and claims are up, optionality keeps you from selling low.

Insurance timing, this is where late‑career households get burned. Disability coverage usually drops off at retirement, but your highest‑earning years are often your most fragile. Employer LTD typically replaces ~60% of base salary; make sure elimination periods and own‑occupation definitions match your reality. And yes, short‑term disability plus an emergency fund should cover those first weeks. For unemployment, line up benefits timing with severance and COBRA so there’s no gap, states differ, and the coordination gets… messy. One more thing people skip: spouse coverage gaps. If one partner has weak LTD or no PTO, you either beef up their coverage or increase the joint cash buffer. The Social Security Administration has repeated the same uncomfortable math for years: about 1 in 4 20‑year‑olds will experience a disability before retirement age (SSA, 2023 actuarial references). Different life stage, same message, disability is more common than people think.

Debt: refinance or renegotiate high‑rate balances while you still have strong income. If mortgage rates ease later this year, great, run the math on a breakeven refi (costs ÷ monthly savings). If they don’t, at least attack 20%+ APR cards and any variable‑rate personal loans. For HELOCs already drawn, ask for a rate discount or principal‑only recast, I’ve seen 25-50 bps trims just for asking, and yes, that’s boring phone‑tree work.

Rebalancing rules you’ll actually follow: set quarterly bands and automate. Example: if a target 60/40 drifts beyond ±5 percentage points, trade back to target on the next quarter‑end. If I just said “volatility bands,” what I mean is simple guardrails that force you to sell some of what went up and buy what went down, without overthinking the headline of the day. Calendar + bands beats vibes, every single time.

Admin cleanup (the silent killer of plans). Beneficiary designations on IRAs, 401(k)s, HSAs, life insurance, review them annually and after any family change. A will doesn’t fix a bad beneficiary form. Add durable powers of attorney and updated healthcare directives; name backups. I call it administrative inflation: the number of accounts and logins creeps higher each year and paperwork costs more time than it used to. Quick checklist below, do two per week and you’re done before year‑end.

• Emergency fund targets set; HYSA/T‑bill ladder opened; HELOC approved, undrawn
• Disability: confirm coverage %, elimination period, own‑occ; address spousal gaps
• Unemployment timing with severance/COBRA mapped
• Refi/renegotiate high‑rate debt while W‑2 is steady; document breakeven math
• Rebalance on quarter‑end if allocation drifts beyond ±5 pts
• Beneficiaries/POAs/health directives updated; keep copies in one shared folder

Small, boring moves done on time beat big, brilliant moves done too late. Especially in years like this when the macro picture wobbles.

Zooming out: resilience beats precision

At this stage, the bigger picture matters more than the last decimal. In a year like 2025, prices not cheap, rates not free, headlines noisy, the edge isn’t perfect forecasts. It’s systems that bend without breaking: inflation-aware income, flexible withdrawals, smart tax timing, and enough cash to sleep. I’ve watched too many plans fail not because the spreadsheet was wrong, but because the owner panicked at the wrong time.

You don’t need exact numbers; you need ranges and rules. Markets will hand you surprises. Since 1980, the S&P 500’s average intra‑year drawdown has been around 14% even when many years finished positive (J.P. Morgan long-run study). Post‑WWII recessions have lasted about 10 months on average (NBER). And earlier this year, 6‑month T‑bills hovered near 5%, while 10‑year TIPS real yields sat near ~2%. None of that tells you what happens next. It tells you to design for variability.

Build an income stack that fights inflation and behavior errors. Guaranteed income plus inflation hedges lowers the odds you sell at the bottom. Think Social Security (annual COLA), a base annuity if needed, then laddered TIPS/I‑Bonds and short T‑bills for near‑term needs. The Trinity study shows that rules‑based withdrawals (e.g., a 3.5%-4.5% starting range with guardrails) historically held up well over 30‑year windows with balanced portfolios. Precision isn’t the point; avoiding forced selling is.

Keep optionality front and center.

• Liquidity: 6-12 months in HYSA/T‑bills. Cash that costs you 1% in expected return but saves a 20% mistake pays for itself. FDIC/NCUA still $250k per depositor, per bank, spread if needed.
• Multiple income levers: part‑time work, delayed Social Security, Roth conversions, a modest SPIA, or just trimming discretionary spend for a quarter. Small levers, big effect during drawdowns.
• Tax diversity: taxable + pre‑tax + Roth. When jobless claims tick up or risk assets wobble, you can pick the most tax‑efficient cash source rather than taking the only one. Side note: I still kick myself for not doing a small Roth conversion in 2022 when brackets were low, don’t overthink tiny moves.

Use rules, not vibes. Set withdrawal guardrails: cut 10% of the draw if the portfolio breaches a preset band; grant yourself a “raise” after strong years. Coordinate that with tax timing, harvest losses in bad years, realize gains when income dips, bunch deductions when they actually matter. You won’t hit the exact optimum. You don’t need to.

When to update? After life changes, not cable news segments.

• Birth, death, marriage, divorce
• Job loss or big raise; relocation; business sale
• Rate regime shift you can act on (e.g., annuity pricing, mortgage refi math)

One last note that I almost buried: behavior beats basis points. Headlines will keep yelling. The plan is simple, ranges and rules, inflation‑aware income, liquidity for sleep, tax flexibility. That mix survives more futures than any spreadsheet I’ve ever built, and I’ve built…too many.

Resilience > precision. Breathe, rebalance, and rerun the rules when your life changes.

Frequently Asked Questions

Q: Should I worry about rising jobless claims if I’m 6-12 months from retirement?

A: A little, yes, but it’s manageable. Slowing hiring tends to hit portfolios and wage growth, and inflation on services still bites. Buffer up: build 12-24 months of essential expenses in cash/short Treasuries, lock in key costs (Medigap, long‑term care features, fixed-rate debt payoff), and stagger any big retirement-date decisions. If you get laid off early, that cash runway keeps you from selling risk assets into weakness.

Q: How do I adjust my withdrawal plan for inflation that’s hotter in services than headline CPI?

A: Use a guardrails approach instead of a flat 4%. Start with a 3.5%-4% initial withdrawal, then give yourself a cost-of-living raise each year only if your portfolio stays within bands (say, 20% above/below its inflation-adjusted target). Prioritize spending cuts in categories running hot, medical, home repair, travel. Hold 12-24 months of withdrawals in cash/short Treasuries, add TIPS for the next 3-10 years, and keep an equity sleeve for long-term growth. Review annually; change nothing midyear unless you breach a guardrail.

Q: What’s the difference between nominal and real returns, and why does it matter for my retirement paycheck?

A: Nominal is the sticker return, what your account shows. Real is after inflation. If your portfolio earns 5% and inflation runs 3%, your real return is roughly 2%. Here’s the rub this year: retirees spend more on services like healthcare and repairs, which historically rose faster than overall CPI (BLS shows Medical Care CPI up ~110% from 2000-2023 vs ~78% for headline). So aim to out-earn your personal inflation, not just the headline, when setting withdrawals.

Q: Is it better to keep more in cash this year with yields up, or stick with a balanced portfolio in retirement?

A: Tempting as it is to hide in cash, because, yes, yields are way better than the 2010s, that’s a short-term comfort with long-term risk. Cash tracks today’s rate, not tomorrow’s prices. Your liabilities are inflation-linked, especially in services. I’ve watched too many folks “wait it out” in cash for 2-3 years and then realize their purchasing power slid while markets recovered without them.

What I usually recommend now: match the tool to the time horizon. Park 12-24 months of essential expenses in cash or short Treasuries so you’re not forced to sell in a drawdown. Build a TIPS ladder for years 3-10 to harden the middle of the plan against persistent inflation. Keep an equity allocation for growth, often 40%-60% in retirement, adjusted for guaranteed income and risk tolerance, with a tilt toward quality, cash‑generative companies and dividends you can actually live with. Sprinkle in some short-to-intermediate high‑quality bonds for ballast. If you want more certainty on core spending, price a partial SPIA for your age as a floor; don’t over-annuities the whole plan.

Mechanics matter: rebalance annually, harvest losses when offered, place bonds/TIPS in tax‑deferred, equities in taxable for step‑up and qualified dividends, and revisit Roth conversions in Q4 if your marginal bracket is temporarily low (watch Medicare IRMAA cliffs). Net-net, hold enough cash to sleep, but keep growth assets so you can afford to wake up ten years from now with the same lifestyle, or better. Yea, boring. But boring wins here.

@article{protect-your-retirement-rising-inflation-jobless-claims,
    title   = {Protect Your Retirement: Rising Inflation & Jobless Claims},
    author  = {Beeri Sparks},
    year    = {2025},
    journal = {Bankpointe},
    url     = {https://bankpointe.com/articles/retirement-inflation-jobless-claims/}
}