The Genius of AND: Living in the Present AND in Retirement

As humans, we often default to compromise. We tend to think in terms of “or.” Yet problem solving and thriving are more commonly the result of implementing the “genius of and.” A former FBI hostage negotiator, Chris Voss, teaches that when negotiating a deal, you shouldn’t compromise and “split the difference,” because neither party gets what they want; thus, neither party is happy. Rather, negotiate and collaborate. Look for unique ways to solve problems and navigate the situation. This can mean you don’t have to choose between living in the present and living in retirement. There are likely ways to get creative so that you can live now and in retirement.

Of course, we still have to acknowledge some financial realities: the economic truths of life. No money? Probably no retirement. So where is the balance? How can you find it without just splitting the difference, as Chris Voss would say?

Let’s start by understanding the major variables of basic retirement planning: savings rate, spending rate, retirement date, rate of return on investments, and what I prefer to call “the end of your financial plan.”

In reality, you get to pick some; the math runs and solves for the others. We learn in Algebra 101 that if you change something on one side of the equation, you must change it on the other. So, here is how it works: if you want to retire earlier (changing the retirement date input), you have to make an offsetting change in the other variables. You can increase your returns or the amount you put away or decrease spending expectations.

Take any one of those four—you can change it by adjusting the other three. So where balance is struck is in being honest with yourself and exploring what adjustments you can make, rather than rigidly fitting a change you find unacceptable. Let me give you an example.

As some people struggle with living now versus socking every penny away for retirement, they need to evaluate what retirement really means to them. It’s not just a date on the calendar. It is a process and requires a plan.

If you are currently saving $2,500/month for retirement but want to live more in the present, see what adjustments can be made other than “just working longer.” Sure, working a part-time job during a transition period may be the answer. However, it may be getting comfortable with new or different investment options to increase return potential. Maybe it is spending more time optimizing your tax planning to increase net-of-tax returns. Maybe it is being real with yourself about the lifestyle you want to live once you are retired and slowing down. Most importantly, perhaps it’s a combination of all of those things that allows for minor changes to be made in all areas, but collectively you don’t feel like you have significantly sacrificed, and you can obtain your goal of having more cash flow to live in the present.

My simple word of caution, however, will tie back into my current opinions on the markets in the current macroeconomic environment. There is incredible recency bias in the markets and portfolios. We have experienced exceptionally high returns in the stock markets, broadly speaking, post-2009, and until 2022 we experienced meaningful returns in the bond market. However, I do believe the world has shifted and is writing a new playbook. Equity valuations are near all-time highs (Shiller P/E ratio of ~36.65*), bond yields are secularly on the rise (higher interest rates), and inflation is proving to remain stubbornly well above target. Navigating the next fifteen years will likely look much different than the last fifteen years. Do not fall victim to simply increasing your expected rate of return on investments or lowering your inflation expectations without having a meaningful and justifiable reason to do so.

As always, focus on what matters most in life: family, relationships, experiences, and values. Money is just a way to maximize them. Happy retirement planning.

*Source: https://www.multpl.com/shiller-pe (03/27/2026)

Disclosure: Information presented is for your educational purposes only and should not be regarded as a complete analysis of the subjects discussed.  Discussions and answers to questions do not involve the rendering of personalized investment advice but are limited to the dissemination of general information.  A professional advisor should be consulted before implementing any of the options presented.

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