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If you look at the major risk categories that mostInvestment professionals consider when they’re thinking about, um, helping people for retirement. Market volatility in the short term gets all the headlines in the news, but far bigger lever for people to have the right outcomes is behavioral risk.
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The world of retirement planning is ever changing. There are new laws, new products, new research, and the list goes on. And what’s more, retirement planning is often complicated and confusing and filled with contradictions. Well, here to help us decode all that is Michael Dozier. He is a SVP, senior vice president, and head of retirement at LPL. Mike, welcome.Hello, Bob. Happy to be here. Oh, it’s a pleasure to have you here, and it will be a pleasure to have you decode some of the changing landscape that is going on in the world of retirement planning. And, and where I want to start is this notion of the convergence of wealth and retirement planning. And my understanding is for many, many years, there’s been a disconnect between wealth planning and retirement planning. Someone might be saving for retirement in their 401k. They might have an advisor.Who is doing wealth planning, but those two things never really connect because sometimes the advisor isn’t always advising a person about their 401k plan, but they might be advising them about their taxable accounts or their Roth accounts or things of that nature. Um, walk us through this convergence and, and then why it’s so important that these two types of planning converge.
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Yeah, thanks, Bob. This is my favorite topic to talk about right now. As a matter of fact, I saw a post on LinkedIn just this morning from an industry editorial, um, person that we all know, been in the business for years and years, talking about convergence has always been kind of a forward looking, it’s coming, it’s coming. I think it’s here now. And, and I think it’s here for several reasons. I’ll focus in on 3.Um, I think for those listeners that are more individuals concerned about their own retirement, I think it’s because you, as an individual, have needs that need to be addressed in a more simple way, right? The, the entire infrastructure of the financial services side of retirement has been built around codes of legislation, right? Think of 401k and Roth and IRA andAnd
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the HSA and the list goes on, right?
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It goes on and on and on, and, and all of those things were compartmentalized from the word go, right? And now if you’re an individual investor trying to do it on your own, you’ve got to understand that I’ll call it the alphabet soup to figure out what you need and where.It only gets marginally better if you hire an advisor. I think an advisor does make a significant improvement around behavioral aspect of things, and we can come back to that later. ButSorting through all of the different products, and where they reside, and how there’s access to them. Again, it’s only marginally better for an advisor, but it is better. Um, and so, this pursuit of simplicity is job one. How can you as an investor, look at all of your resources, all of your needs, and look at them singularly instead of in multiple buckets. That’s, I think, the biggest driver. And I thinkThis convergence of wealth and retirement we’ve been talking about for 10 years, I think it’s just now getting to the point where it’s being operationalized at the individual investor level to better integrate and simplify things.The second thing that’s driving it is really legislative and regulatory activity. As crazy as things have gotten over the last 5, 10 years in Washington, where it seems like they can’t agree on anything, even the color of the sky.They can still always agree on retirement, right? That’s one of those topics that seems to becomeInherently bipartisan, and so that means things are constantly coming at us.The entire business, as we talked about a second ago, were built on lines of code and the name of them. So, every time they take action, it has an impact on us. And I do believe that our friends in Washington are trying to do the right thing by making workplace retirement plans more available. Think of Secure 10 and Secure 20.They’re also trying to get tax incentives lined up so that people can literally work together, um, whether you’re a 401k administrator or you’re an individual wealth manager that’s trying to help clients. The infrastructure is coming together, in tech organizations are emerging to help port in 401k management, so advisors can do in and out of plan work. Uh, so, all of that’s happening. That’s kind of the second big bucket.And the third bucket, which I think is really not so much aimed at your individual retail investors who are listening, but the advisors, and that is advisors’ practices are shifting.And now advisors are thinking about not just being wealth managers, but being retirement plan advisors and wealth managers. And I think that’s the newest ingredient. You’ve seen lots of mergers and acquisitions at the corporate level over the last 10 years of big brand names that are known as retirement providers, started buying wealth companies, and wealth companies buying retirement advisors, but now it’s kind of filtering its way down to the individual advisor.And the advisor saying, why don’t I both run retirement plans that help all those participants in the retirement plan, and literally integrate that with my individual wealth management business, so that I have a more holistic capability.
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Yeah. So much to unpack there, Mike. Uh, we’ll, we’ll dive deeper into all those three things in a second, butI just want to react to what you just said about, um, all the codes that are out there. I’ve often thought that if you had to build this advice industry, this advice profession from scratch, it wouldn’t look anything at all what it looks like today, right? Everything that’s been built has been in reaction to something.And if you had to start from scratch, maybe it would look more like the medical profession or the legal profession or the CPA accounting profession where there might be one set of laws and one regulator, and, uh, we wouldn’t have to deal with insurance, state insurance agencies and an SEC and a FINRA and on and on and on because right now we have people in the advice profession who are regulated by different entities and who may be allowed to sell one thing but not another. And so it’s a mess out there to me anyway.
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Yeah. Well, think about it. One code we didn’t even mention in our alphabet soup was 529s, right, right? I mean, it’s not retirement specifically, but having a good plan for either your own personal college savings or your children, obviously is a part of a broader plan towards, you know, your entire life’s picture.And there’s a solution for every state, and they’re not, they’re asynchronous, to say the least. Um, I do believe there’s something there, and you, you made the comment about the health industry, a very influential body, especially when it comes to getting what they want out of Washington. And it does, it’s not lost on me that the health savings account is the only triple tax-free device that’s out there.Maybe there’s some way we can think about that more broadly, but that would include a dramatic give out in future tax dollars from our friends in Washington, which would be an uphill battle, to say the least. Yeah.
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So, I wanna do a little bit of a deep dive on the behavioral risks in retirement planning, and the research I’ve seen seems to suggest that advisors who have an understanding of behavioral biases can help add uh a significant uh amount to a person’s portfolio just by being aware of the behavioral biases and what if the mitigation.Strategies might be to help someone overcome things like recency bias or overconfidence or whatever the case may be. And I think you’ve noted in the past that, uh, sometimes people’s emotions is a greater risk than market volatility. Maybe, uh, address that for a second.
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Yeah, happy to, Bob. You’re right, I have. I’ve been on this one for a long time. I was fortunate enough early in my35+ years ago, getting into this business to be introduced to some of the burgeoning behavioral finance industry that was coming out of some of the major academic institutions, and I do believe that there is absolutely science behind some of the behaviors, recency bias, and other things that you’ve talked about. I do think that if you look at the major risk categories that mostInvestment professionals consider when they’re thinking about um helping people for retirement. Market volatility in the short term gets all the headlines in the news, but far bigger lever for people to have the right outcomes is behavioral risk, right? And making sure they take the right actions at the right time.The easy example, there’s two of them actually that come to mind to me. Market volatility and running when you should, running away when you should be maybe turning and running toward the activity, and getting started at an early enough age when it feels like it’s still such a far-reaching activity, right? Your average 22 or 23 or 24 year old doesn’t think about retirement every day.Not surprising. So, I think using levers like some of the negative election, auto enrollment features, and auto escalation, and defaulting people into long-term suitable investments rather than money market funds, all of those things have helped from a behavioral standpoint.But you mentioned the biggest one, and that is, I do believe that there’s lots of research out there that shows that you can fund several additional years of retirement just by having the right advisor relationship, and having them hold you accountable to the right behaviors at the right time. Starting to save early enough, saving enough, staying the course through times of volatility.I remember, I’ve been around long enough to remember several market shocks. In, in the early ones in my career, there would be a 20 and 30% flight to quality right in the middle of the most precipitous downturns, which academically, you know, is the wrong thing to do.In the early stages of the pandemic a few years ago, I saw the numbers had dropped considerably. So, I think we’re winning this battle. I think advisors have made an impact. I think people looking at websites and financial wellness solutions. I saw the flight to quality in that really shocking drop in the spring of 2020. I think it was less than 8%.Of retirement plan investors sold in the middle of the drop. So that to me feels like we’re moving in the right direction.
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Yeah, oftentimes when I talk to advisors, they often say that, but the biggest value that I add to my client relationship is, uh, stopping them from selling when they shouldn’t during aMarket dropped. The, the other thing that comes to mind is when I think about advisors in this new world order is the stakes are higher for them now to have a knowledge of these behavioral biases, uh, and, and the mitigation strategies that could help their clients andUh, and, and, you know, this is something that, you know, if you’re a CFP maybe you weren’t tested on this years ago, or maybe you weren’t trained or educated about the behavioral biases. But now it seems like, given the value add that it can, uh, offer someone, it’s really imperative that someone understands these biases and can help their clients with them.
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Bob, I would take it a step further. I think it’s almost the price of admission to be a successful advisor moving forward. If you think back, what was the quaint term we used 5 or 10 years ago, I think it was robo advice, right? And it feels to me like we’ve effectively moved past thinking of that as a competitor to an advisor. I think in some cases, it probably still is, but I think whether you call it AI or you call itFinTech advancements, the, the automation and the intelligence that can be coded and built in, is only going to be seen, I believe, as a resource and a tool for an effective advisor to do more of what they do well, and that is more of the behavioral and almost psychological side of dealing with their clients, right? So, if you’ve got 80% of your book of business, 80% of your clients that areYou know, pretty steady Eddie, and they stay the course, and you just have to give them the roadmap.A lot of people now like digital engagements, right? I mean, they like to be able to sit up at 11 o’clock at night with their bunny slippers on, and, you know, do some modeling and play around, and just use that advisor time when they really do need to counsel. And I think that’s exactly one of those times, right? Right when things get a little crazy and people start to feel that anxiety, cause I think I also read somewhere that money is just behind health as the number 2 concern that emotions flare up about.That’s where you can use it. It helps the advisor, help the investor, I think, in a much more effectiveway.
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Yeah, Mike, we have to take a short break and when we come back, I want to talk about the regulatory landscape and what changes are coming in 2026. So don’t go away. Welcome back to Decoding Retirement. I’m speaking with Mike Dozier. He is a senior vice president and head of retirement at LPL.Mike, before we took a break, I said that I wanted to talk about some of the, uh, regulatory issues that are going on and what’s changing for 2026. We’ve had secured, uh, 2.0 come out. We’ve had RMD ages change, which is, which has my head spinning. And, and then of course, we have policy changes like the senior deduction at $6000 or the salt, uh, salt deduction going up to $40,000 all of which have, uh, planning implications for investors and for advisors. So walk us through what we need to know from your perspective.
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Yeah, or, uh, do we have a couple more hours? Um, there, there’s a lot, uh, as I said earlier, right, because retirement is one of those topics that Washington can’t agree on, we often get all kinds of help from our friends in Washington, both on the legislative as well as the regulatory side.That can be a blessing and a curse. Um, right now, it’s feeling like there’s so many blessings that it’s almost borderline becoming a curse. Um, I would say, looking at all of the deadlines that we’ve been experiencing for the last 4 or 5 years, right? Because secure 10 in 2019 and secure 20 in technically 2021, but started becoming effective in 202, there wereYou know, hundreds of provisions that were impacted. Lots of noise in there. If, if you as an individual investor aren’t tracking those, or you as an advisor aren’t tracking those, I would highly encourage you to tap into a resource like LPL or any other financial services website. You’ll be able to find them in a grid somewhere. Just go through the checklist. I’m gonna focus in on the one or two big ones, given our constraint of time here. I think the biggest one right now in December of 2025 that people need to think about.Is Roth inside of 401k plans, right? That’s not news, that’s not new. Uh, it is more and more where people are making the choice to put their money, instead of the old pre-tax way. I think I read somewhere recently that 1 out of $5 I think it’s 21 or 22% of all retirement plan assets are now.In a Roth category, right? So, I think we’re all waking up to the fact that maybe my taxes will never be lower in the future. And if you believe that, then Roth is a smarter way to go than pre-tax. I’m not here forecasting on taxes, I’m just laying out what I see as the math.The reason I bring Roth up right now inside of the K plan is one fundamental shift does happen, 1126, and that is if you’re an elder statesman, and you are 50 plus, and you are taking advantage of catch-up provisions, which I encourage all of you to, um, you can only do ketchup provisions moving forward in a Roth class. So,If you’re an advisor, and the plans you’re advising don’t have Roth.I would start having that conversation with the plan sponsor yesterday about whether or not they thought that through, and if, especially more highly comped individuals wanna continue to, you know, contribute towards um catch up and provisions, it it makes Roth almost mandatory.My lawyers would freak out for me saying that way. Roth is not mandatory, but it does de facto become mandatory if you wanna take advantage of ketchup provisions. So that is the biggest of big items. Yeah.
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One other note about ketchup contributions, we know that under the newLaw, the one big beautiful Bill Act, I believe, uh, we now have the ability to do a super catch up for folks who are aged 60 to 63, which adds an additional amount on top of the regular contribution amount. So for folks in that age group, they should take advantage of it as well.
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With, without question, right? I mean, we think about, I know we’re probably not gonna have time to get to this topic formally today, Bob, but you know, we, we all talk about lifespans and longevity. I, I don’t think there is a person that I’ve seen, and I’ve looked at millions and millions of 401k plans that couldn’t stand to take full advantage of whatever the cap is, whether that isUm, you know, you’re, the normal cap for, you know, people under 50, 55, 60, 65, take full advantage. So, I think you’re right, the super catchup is a great thing to call out. The other thing I would call out, and I know we probably need to move to the next topic, you touched on it is RMDs, right? I mean, RMDs changed in a couple of ways. First, the age for RMD moved twice on us, that’s why it’s confusing, right? It moved in secure 1.0, and if I’ve got this right, it also moved again secure 2.0. So,There’s another 3+ years of accumulating assets that those of us that don’t need to tap it right away, you can take advantage of. And again, I think if you look at the, all the modeling and calculators out there in the system, if you can afford that, it’s a great advantage for long-range planning of your assets. Um, and then, the RMD beneficiary situation, the tax laws changed around that.I’m not gonna get into that here, cause that’s way too complicated, but if you are in one of those situations where you have been the beneficiary of a retirement plan, and you’re starting to noodle around the RMDs, their laws have changed on the tax treatment and the timing of that. So, those are the two big ones that I would call out.
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So Mike, in, in your new role, uh, I want to turn to advisors. Um, in your new role, you help advisors help their clients, uh, around the retirement planning issues, planning for retirement and maybe living in retirement as well. And when I, uh, we talked about this earlier with regard to behavioral finance that the stakes are higher now for advisors to know that.But the stakes are also higher for them to acquire new knowledge, skills, and abilities when they think about moving their clients from planning for retirement into living for retirement. In the past, maybe they didn’t need to know about a reverse mortgage, or maybe they didn’t need to know about a hybrid, uh, long-term care, life insurance policy. But now they do in order to help them move from this transition from planning for retirement to living in retirement. Talk about like,Where advisors need to be in order to aptly serve their clients whose needs are now all that greater.
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Yeah, Bob, that’s a, there’s a lot of complexity there. I do believe that the, not just the advisor community, so you’ve mentioned that I’m, I’m new at Ek Hill. I’ve been here for about 10 months now, but as you can probably tell looking at me, I didn’t graduate from college 10 months ago. I’ve been in this business for 35 years. I’d always worked on kind of the asset manager, product manufacturer side. So this is a fresh perspective to me to work amongst the advisor community, and I gotta tell you,I couldn’t be more jazzed up about the future. I do believe that advisors are absolutely, I would say, a requirement to successful retirement planning, especially when you start talking about that transition from accumulation to, I won’t use the D word, I call it
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distributionccumulation word, yeah.
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You just think it’s not a normal English word. Um, so, in the distribution phase, there are tools, reverse mortgages that you mentioned.Using maybe some kind of guaranteed products depends on the needs of the individual investor. Um, but thinking about the distribution phase is just inherently more complicated. Um, I think most good advisors have started to wake up to that. I know there are certifications out there that people can get to think about from a, you know, living in retirement as an advisor. Uh, I really encourage you to pursue those. There’s a couple of big names in those in the industry.Um, I, I, there’s a very negative, but it’s the analogy that always works for me, is the mountain climbing analogy, right? I mean, there’s the more people have died coming down the biggest mountains in the world, then the, the sin is just harder than the asset. Um, and I think that is true here too, right? There are sequence of return risks and things that once you’ve achieved, you know, most of your human capital value is gone.And now you’re using your financial capital that can’t be redone. So you have to be very thoughtful about those moves. Advisors have lots of tools available to them to help, whether those are modeling tools, or a broader set of products. I do think thinking about income streams at a bucket level makes all kinds of sense. Most people immediately jump to buckets being buckets of time.But I think of the buckets that are more meaningful is your buckets of where your expenses are coming from. So, if you have non-discretionary fixed expenses, so, a mortgage that isn’t paid off.You’ve gotta think about that money very differently than you think about the money that is more discretionary, such as traveling, or rounds of golf, or whatever your hobbies might be. And then you’ve got non-discretionary that aren’t fixed, that are inflation impacted. Those could be some variations of healthcare expenses. I think you have to look at all three of those very differently. You also gotta make sure you do one very significant thing, and that is not think about just yourYour personal resources and assets, but you gotta think about the biggest retirement income tool we’ve all got, which is Social Security, right? And now, I think the world has changed where Social Security modelers and calculators can be literally integrated into the financial picture of all your resources. And this comes back to the very beginning of our conversation, the convergence of wealth and retirement.You’ve gotta be able to look at your money that sits out of the 401k right alongside the money that sits in the 401k, right alongside Social Security, in order for the picture to be complete.And you can’t do that exercise 3 times. That would be, you know, borderline, and, you know, that would drive people insane, and it probably has in some cases. I know it has me. So, I, I think thinking about it more holistically is really the future that advisors or most good advisors are living in today.
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Mike, I’m afraid we’ve run out of time, so I want to thank you, uh, ever so much for sharing your knowledge and wisdom with us and our viewers and listeners. Thank you.Appreciate it, Bob. It’s happy to be here. So that wraps up this episode of Decoding Retirement. We hope we provided you with some actionable advice to help you plan for or live in retirement and don’t forget you can listen to and subscribe to Decoding Retirement on all your favorite streaming platforms.
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This content was not intended to be financial advice and should not be used as a substitute for professional financial services.