2 Retirement Experts Discuss How They'll Decide When to Retire

In this podcast, Motley Fool retirement expert Robert Brokamp speaks with Fool contributor Dan Caplinger about how they're approaching the decision of when to call it a career.

Also in this episode:

• December saw the highest number of home contract cancellations in several years.
• Home prices declined in November.
• A study found that 75% of homes on the market are unaffordable to the median-income American household.

To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. When you're ready to invest, check out this top 10 list of stocks to buy.

A full transcript is below.

This podcast was recorded on Jan. 31, 2026.

Robert Brokamp: How to decide when to retire and updates from the housing market? You're listening to the Saturday Personal Finance edition of Motley Fool Morning. I'm Robert Brokamp, this week, I speak with Motley Fool contributor Dan Caplinger about how we're each determining when we can retire. But first, here are some news items from last week, and they all have to do with housing. First up, Redfin announced that more than 40,000 home purchase agreements were canceled in December. That represents 16.3% of all homes that went under contract, the highest percentage of monthly cancellation since Redfin began tracking the metric in 2017. One reason could be that home buyers are becoming more cautious amid economic anxiety. After all, the Michigan consumer sentiment index is near its lowest level in 50 years, though it has ticked up a bit in recent months. But another reason is that inventory has risen, giving potential homebuyers more choices. According to Chen Zhao, head of Economic Research at Redfin, "Home sellers outnumber buyers by a record margin, meaning the buyers who are in the market have options and may walk away if they believe they can find a better or more affordable home." This rise in inventory has weighed on prices, which brings us to our second item. Last week, it was announced that the S&P Case-Schiller Home Price Index declined 0.1% in November and grew just 1.4% year over year. That's a slowdown from what we've seen in recent years. Home prices are up more than 50% since the pandemic, including double digit gains in 2020 and 2021. Such strong price growth over the past several years may have you wondering how real estate compares to the stock market. Well a recent article from the Bespoke Investment Group took a look and found that the 20 year return of the S&P Case-Schiller index is actually just 3.1% per year on average. That's about what long term treasuries have returned over the same period and much less than the 10.8% annual return from the S&P 500. Of course, with a house, you can benefit from leverage and not having to put all that money down at once. On the other hand, a house has ongoing expenses like taxes, maintenance, and insurance, factor all those in and studies show that home price appreciation tends to be just a bit above inflation. Despite the recent slowdown in home prices, many Americans still can't afford a house, which brings us to our number of the week and it is 75%. That's the percentage of homes on the market that are unaffordable to the average American household. According to a bank rate analysis, a family would need an annual income of $113,000 to afford a $430,000 median priced home. Unfortunately, median household income is closer to $80,000. Middle income households can afford at least 30% of the listings in only 11 of the nation's 34 largest Metro areas. This level of unaffordability is due to high home prices, wage growth that has not kept up with those prices, higher mortgage rates, and not enough homes. According to bank rate, the US faces a housing deficit of about 4.7 million houses. Up next, two fools getting close to retirement, talk about when they'll actually retire when Motley Fool Money continues.

After saving for retirement for decades, you'll actually get to a point when you realize, Hey, I could retire soon. I'm in that situation, as is my next guest, Fool contributor Dan Caplinger. For this episode, Dan and I are going to have a conversation about how we're approaching the decision about when to retire. Dan, welcome back to Motley Fool Morning.

Dan Caplinger: Hey, thanks for having me, bro. Great to be with you.

Robert Brokamp: We have a lot in common. We're both former financial planners, both have been associated with the Fool for more than 25 years. We're in our mid to late 50s. We have kids in college, and we both are getting to the point where we could retire soon. Though likely I probably should work for a few more years just to be safe. What's your situation, and how are you approaching the decision about when you'll actually pull the plug?

Dan Caplinger: Well, bro, I'll tell you, the way I'm approaching the situation is the way that I approach most of my work, which is by over analyzing and overthinking and going back and forth and trying to figure out how to weigh all the factors because there are so many factors. There's emotional factors. There's financial factors. There is personal life and personal lifestyle factors, all kinds of stuff, and there's so much uncertainty. The thing that I've learned here is that whenever I make a final decision when that day comes, I'm not going to be 100% certain that it's going to work out. It's going to be a jump into the void, and you just have to have the faith that it's going to work out. That's what I'm trying to build myself up to at this point.

Robert Brokamp: From the financial standpoint, how are you analyzing your situation? I know you're a guy who loves spreadsheets. Do you have your own spreadsheet or do you use some online retirement calculators?

Dan Caplinger: Oh, I've got spreadsheets out the wazoo, bro, which should surprise you not at all, and I've been tracking them throughout my career. So I can go back and look at what I've done in the past, how it's gotten me to where I am today, what it is likely to bring me to in the future. I feel confident about the projections that I've made, that they're as good as I can make them, but there are still all these unknown unknowns out there that you have to somehow account for. The way that I've done that is to try to give myself as many additional escape valves, as many, I call them slush funds almost of extra pockets of money that are dedicated for certain things that if I need more money in one area, it'll be there. It won't necessarily affect my regular budget. I try to use spreadsheets to figure out where I'm going to be with my investments and what effect changes in how I invest might have on what my future looks like. I do use some online calculators. The Social Security websites calculator for Social Security has been extremely helpful. In addition, there are some calculators on the Motley Fool website that I've used. Really, just to double check my numbers on my spreadsheets and also to try to get some additional insight on what the established financial community would tell me is the right answer and then I can customize and do my own tweaks to make it more my own because I know what my preferences are. I know where I differ from where the mainstream thinking is, and so making allowances in my own personal financial plan, that I can do, but I still like to know where the bass line.

Robert Brokamp: Yes, I like retirement calculators, and I'm going to list a few in the next segment here. You mentioned that they're both really emotional, maybe psychological issues as well as financial issues. Knowing you as well as I do, I know that you probably could retire right around now. What is preventing you from retiring? Is it the fact that you like what you do? You're not sure what you would do in retirement? Are you nervous about the financial situation right now? Maybe stock valuations? What's preventing you from retiring?

Dan Caplinger: It's a combination of factors, bro, but I'll tell you. I've been thinking about retiring for a long time now. When I was a younger person early in my career, I set age 50 as my target for early retirement. That was at a stage in my career that I wasn't as happy with my work as I have been at the Moley Fool. Being at the Fool took away the urgency for, I got to get out of this rat race as quickly as possible. At the same time, it just so happened that my 50th birthday came right in the middle of COVID. So, I had been thinking about it. I had about $2.5 million in retirement at that point. My numbers, I'm not that profligate a person. My budget, I think I could have made that work. The early healthcare before Medicare is always the big factor there. But at that point, all the things I wanted to do I wouldn't have been able to do. So retiring in the middle of COVID just made no sense whatsoever. Wouldn't have been able to travel, wouldn't have been able to do the things that I really wanted to do. It was just as easy to stay inside and do the same work that I'd been doing for 15 years at that point. Fast forward to now. I've really enjoyed the past five years of work, and so, yeah, it's been a great market in that period. I've roughly probably more than doubled my retirement savings in that period. From a financial standpoint, I think any financial planner would say that I'm totally set and that I shouldn't worry. Nevertheless, just as I experienced earlier in my career when I was a financial planner, I was working with people who were at the age that I am now, you never feel like you have enough. You never feel like you have everything set that you're going to be able to account for every possible contingency that you're going to be able to deal with whatever the uncertainty of the moment is in current events and politics and geopolitics, and economics, whatever it is. I think that holds me back as much as anything, as well as trying to figure out, yeah, I know what I'm going to do the first year of retirement, and it's going to be a blast. But am I going to really want to do that? Am I really going to want to travel? Am I really going to want to be away from home for 10 years? If that's not the case, well, geez, should I just take a one year sabbatical and then just come back to where I am? Those are some of the questions that I'm asking myself at this point.

Robert Brokamp: Foolish colleague I'd lodge with recently. He did leave the Fool, and at the time, he said, I'm not sure I'm retiring or not. I'm just going to just see what happens. Sure enough, within a year, he was bored. He's at another job, and he said to his wife, you know what? I probably just needed a sabbatical, just needed a break, which many people out there might be in that situation. They enjoy their job. They're not ready to retire, but they're burnt out and they would like to take a break. The studies on weather retirement is good for us, it's very mixed. Many studies have found that folks who retire sooner actually die sooner or experience accelerated levels of cognitive decline, physical decline, higher rates of loneliness, higher rates of depression. Certainly a big part of it is deciding how you're going to spend your time and who you're going to spend it with. What are you thinking in those terms? What should people be doing as they approach retirement to prepare for how they're going to spend all that time? How every day is a Saturday, as they say.

Dan Caplinger: I think that probably the best thing that people can do is to work with the people that they know, talk with the people that they know, either who are in that situation or who are preparing the same way that you are looking to prepare. Talk to people who've recently retired. Ask them what do they do and how's it been? Has it been as good as they expected it to be? What are the things that are better? What are the things that aren't quite as what they expected? What are some of the things that if they had to do over again, they would change, maybe? How are they dealing with the process? I think that it's important to build that network in advance, both outside of work and at work. I think people that you work with, I mean, I know Bro, I'm often guilty of this. People will leave the fool, and I don't do as good a job as I should, keeping in touch with them. Like, maybe LinkedIn tells me to wish them a happy birthday, and then that's just me feeling, Oh, geez, I probably haven't talked to this person for a year. Doing that is important because it does two things. One is, it gives you that perspective outside of that bubble of your own work. But two is that it gives you a window into what your future might look like after you decide to make the leap, and you, knowing who those people are, knowing who your friends and contacts are, you can draw some conclusions from what they tell you. Some of it's like, Oh, boy, I'm just like that person. I thought that you would really love that. It turns out you don't. Well, gee, maybe I need to rethink that for myself. Or, yeah, you always want to do this totally different thing. I had no interest in that and so you can draw your own conclusions from that. But I think that's the most important thing is talking to people, both the people that are around you now and the people who are doing the things that you might want to do some period of time down the road so that you get an advanced view of what that life looks like, and you can make course corrections now to guide you toward the better parts of that and steer you away maybe from some of the pitfalls that they fell into.

Robert Brokamp: One thing that's changed with my own retirement planning is that I used to think I would work well into my 60s because I just love my job, and I love the Motley Fool. I'm very fortunate that way. But, as I've gotten older, I've seen more and more people frankly, either die too soon or experience health issues such that they won't be able to pursue most of their retirement dreams because they're no longer in healthy enough to do it. Then there's the other aspect of whether I will still have a job another 10, 15 years from now because of AI. I'm primarily a writer and podcaster, if there's something that AI can do, it's write. I have been planning on an earlier retirement than I previously planned. I may not retire early, but I think that's the prudent decision. In fact, studies show that people on average retire three years sooner than they thought, often because of an unplanned retirement.

Speaker 3: Yeah. I'll tell you, Bro, I had a head start on you on this because unlike you, you're a full employee. I'm a full independent contractor. I work on a one year contract, and I'll tell you, I took that seriously from day one. It was like everybody would tell you, Oh, don't worry, they'll renew you. But lawyer brain in me was like, Hey, this is a one year contract. End of that year, anything goes. So I always planned it that way so that if something did happen, that I'd be ready. As the years have gone by, I laugh at myself every time I have that thought because it's like, well, really? But just like you point out, Bro, there are real threats to what we do, and our industry is changing quite a bit. So having that contingency plan, I think, is vital. Not just if it happens, but also to give you the security and the confidence to get you through your daily life if it doesn't happen. Because then you can just push that to the side. You don't have to stress out about it as much. Sure, it's going to be a stressor maybe. But you still can have the confidence that, yeah, if that happens, I'll be OK. Meanwhile, I'm OK now, too, and I can figure out where I want to go from here. That's just hugely important for your well being in these kind of challenging times where there's a lot of uncertainty. It's not just us, Bro, all occupations out there, there's not as much hiring. You may know it from your kids. I know that my daughter's running through this. Those entry level positions, a lot of the people our age who are, partners at law firms and stuff, they're looking at the future, and they're like, maybe we don't need to hire as many young people because the AI can do all the grunt work that the young folks did. I think that's shortsighted, but it is reality right now and so, all kinds of factors going on right now it's hard to consider that just makes shoring up your financial plan even more valuable to you, both for your financial well being and just for your peace of mind.

Robert Brokamp: Since you keep bringing up lawyerly stuff, I just want to point out to the audience that Dan is a former attorney. Besides being a former financial planner, which is why I often say Dan is just about the most knowledgeable guy at the Motley Fool. Anyone who is thinking about retiring early certainly before age 65 when they get Medicare, they have questions about healthcare. For me, personally, I don't think it'll be an issue because my wife got a PhD at age 52 and has begun a whole new career as a professor, and she has every interest in sticking with that for at least another decade. I always like to bring up her as an example because she was someone who changed careers later in life and has found something really enjoyable. So even if I retire, she'll keep working. I'll get healthcare through her. What about you? What are you thinking in terms of healthcare?

Dan Caplinger: I've been milking off my wife's job in the public sector as the town librarian here in the little town that I live in throughout my career, because as a contractor, I get paid for my work, but the benefits, I don't get the same benefits that an employee does. That's a factor. My wife is a few years younger than I am and we talk about these plans, and it's like, well, do you want to travel with me? The answer is sometimes yes, but probably not as much as I want to. At least for now, she's comfortable with the idea, even if I were to go to a full retirement, she'd be comfortable working and continuing to do the health insurance stuff. That's another one of those uncertainties, though, that comes up because right now, if we retired, I live in Massachusetts. We have the Obamacare coverage, and even before Obamacare was around, the state had its own healthcare exchange, and so that's an option for us, but it's a really expensive option. The coverage under her job is a lot more affordable. So that's a big question that comes up, is like if I stop doing what I'm doing, do I want to go full retirement, or do I maybe want to do something else? Like, get another job that I don't have to worry about the financial aspect of it as much. I don't have to maximize my salary anymore. But just getting something for those benefits might actually be the most important part because it's a natural thing. The healthcare expenses tend to go up. This is the most vulnerable time in my late 50s and early 60s before I'm eligible for Medicare. That's the biggest threat to my financial situation is an unexpected health situation.

Robert Brokamp: Right. That's an important consideration for anyone who does want to retire early, check in to how much it would cost to get insurance through the Affordable Care Act or some other source because it's pretty darn expensive. Dan, prediction time. If you're forced to give a date right now, in what year do you think you'll actually retire?

Dan Caplinger: Well, happily. I hesitate to say retire because I feel like I'm almost like that friend that you were mentioning before, where it's more like it's going to be a transition, more than a retirement. I really hope that I'm spending my time doing something, whether it's paid work, whether it's volunteering, whether it's something that need to make a difference somehow. But I will tell you this, there is a natural transition point coming up this year in 2026. It's my 20th Foolversary as a contractor, is May 31, 2026. I'm looking at that date and trying to figure out, is that when I do a transition? What does that transition look like? Is it just a phase in? Is it cutting back on some of the stuff that I do? Is it a clean break? Still trying to figure that out. But I'll definitely keep you posted, for sure. You'll be the first to know, Bro.

Robert Brokamp: Thanks, Dan. In my situation, I have two kids in college, so I'm definitely not going to retire before then. I would say, at the earliest probably by 2030, 2031 for me. But I'll play it by ear and like you, I would be very surprised if I go cold turkey. I'll probably do some sort of a part time situation and freelance, maybe prepare taxes and taxes and something like that. Just something to keep me busy. Well, Dan, it has been a great conversation. Thanks for stopping by.

Dan Caplinger: You bet. Great talking with you.

ADVERTISEMENT: This episode is brought to you by Vanta. Security and compliance done wrong is a headache. Done right. You build trust and grow faster. That's Vanta. For start-ups, Vanta acts as your first security hire, using AI to get you compliant fast. For enterprises, it's your AI powered hub for compliance, risk, and automating workflows. From start-ups like Cursor to enterprises like Snowflake, top companies choose Vanta. Do security and compliance right. Get started today at vanta.com.

Robert Brokamp: It's time to get it done fools, and this week, I encourage you to analyze your own retirement plan and to see if you're on track to retire when and how you want. There are plenty free calculators out there, but some are much better than others. My favorite comes from Calc XML. Just do an online search for the Calc XML Comprehensive Retirement Planning Module. They offer a few retirement calculators, so you'll know you found the one I like if the last three numbers in the URL are 606. There are also some high quality tools that will cost you a bit of money, but I think it's a worthwhile investment. Three to consider our Maxifi That's M-A-X-I-F-I, Projection Lab and Boldin. That's B-O-L-D-I-N, and I should disclose that Motley Fool Ventures, a sister company of the Motley Fool, has an investment in Boldin. That, my foolish friends, is the show. Thanks so much for listening, and thanks to Bart Shannon, the engineer for the episode. As always, people on the program may have interest in the stocks they talk about, and the Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear. All personal finance content follows Motley Fool editorial standards, and is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. I'm Robert Brokamp. Fool on, everybody.

The Motley Fool has a disclosure policy.