In this episode of Retire with Style, Wade Pfau and Alex Murguia sit down with Dr. Daniel Crosby, a leading voice in behavioral finance, to unpack the psychological side of investing in today’s volatile markets. Together, they examine how market swings and media noise shape investor behavior—and why having a thoughtful media diet and disciplined decision-making framework is more important than ever. This conversation lays the foundation for next week’s episode, where the discussion will shift toward deeper questions of wealth and meaning. Listen now to learn more!

Takeaways

• Market volatility can trigger anxiety—even among professionals.
• It’s normal to feel fear during downturns, but those emotions don’t have to drive your decisions.
• Limiting exposure to financial news may help you stay focused and make better choices.
• Recognizing the incentives behind financial media can help you consume it more critically.
• More information isn’t always better—clarity often comes from less, not more.
• Patience matters. Reminding yourself that “this too shall pass” can be grounding.
• Uncertainty often causes more stress than bad news itself.
• Taking time to reflect before acting can lead to better financial outcomes.
• We tend to give others better advice than we give ourselves—pause and consider what you’d tell a friend.
• Automation and structured plans are powerful tools to reduce emotional decision-making.

Chapters

00:00 Introduction to Behavioral Finance and Market Volatility 02:56 Understanding Market Reactions and Investor Psychology 06:01 The Impact of Media on Financial Decision Making 08:47 Navigating Uncertainty in Financial Markets 12:05 The Importance of Patience and Discipline in Investing 15:03 Frameworks for Better Financial Decision Making 17:55 Conclusion and Transition to The Soul of Wealth

Links

Click here to watch this episode on YouTube: https://youtu.be/6pMFE_-u0YM

The Retirement Planning Guidebook: 2nd Edition has just been updated for 2025! Visit your preferred book retailer or simply click here to order your copy today: https://www.wadepfau.com/books/

This episode is sponsored by McLean Asset Management. Visit https://www.mcleanam.com/retirement-income-planning-llm/ to download McLean’s free eBook, “Retirement Income Planning”

In this episode of Retire with Style, Wade Pfau and Alex Murguia dive into the current market landscape and what it means for retirement planning. They highlight the importance of staying grounded during periods of volatility and how emotions can cloud financial judgment.

Alex introduces the RAIN model—a practical framework to recognize and manage emotional responses—to help investors approach market uncertainty with mindfulness. Together, Wade and Alex unpack how psychological biases influence decision-making and why having a flexible, well-structured plan is key to weathering financial storms.

The conversation also explores strategies for resetting your financial plan in response to market changes, including flexible spending approaches, safe withdrawal rates, and considerations around delaying Social Security. The takeaway? Long-term goals matter most—and with the right mindset and plan, you can navigate uncertainty with confidence.

Takeaways

• Markets are currently down, prompting a need for better financial decisions.
• Emotional responses to market volatility can lead to poor decision-making.
• The RAIN model helps in recognizing and managing emotions during uncertainty.
• It's important to allow feelings of anxiety without acting on them.
• Investors should investigate their thoughts and biases during market downturns.
• Non-identification with emotions can lead to better decision-making.
• Market downturns can be beneficial for savers looking to buy at a discount.
• Resetting financial strategies is crucial during times of uncertainty.
• Long-term investment strategies should be prioritized over short-term reactions.
• Understanding one's retirement income style can impact decision-making during volatility. Maintaining flexibility in retirement spending is crucial.
• Market volatility can impact retirees differently based on their strategies.
• A diversified portfolio can help withstand market fluctuations.
• It's important to adapt your retirement strategy to your personal style.
• Delaying social security can lead to better long-term financial outcomes.
• Behavioral biases can hinder effective investing decisions.
• A financial plan provides a framework for making objective decisions.
• Backcasting helps in setting realistic financial goals.
• Understanding your future self can guide current financial decisions.
• Rules-based decision-making can mitigate emotional responses during market downturns.

Chapters

00:00 Market Volatility and Its Implications 05:02 Understanding Emotional Responses to Market Changes 19:06 The RAIN Model: A Framework for Decision Making 22:54 Resetting Financial Strategies During Uncertainty 23:48 Navigating Market Volatility in Retirement 27:06 Preparing for Financial Decisions in Uncertain Times 28:30 Understanding Safe Withdrawal Rates 29:49 Addressing Behavioral Biases in Investing 32:41 The Importance of Financial Planning 39:16 Strategies for Delaying Social Security

Links

To continue today's conversation.. Join Retirement Researcher THIS Tuesday 4/10/25 at 1PM ET for a timely webinar, hosted by Alex Murguia, Ph.D. called, "Making Smarter Financial Decisions in Volatile Markets". Register now at risaprofile.com/podcast

If you haven't already, visit risaprofile.com/style to discover your Retirement Income Style by taking our RISA® questionnaire for free!

The Retirement Planning Guidebook: 2nd Edition has just been updated for 2025! Visit your preferred book retailer or simply click here to order your copy today: https://www.wadepfau.com/books/

This episode is sponsored by Retirement Researcher https://retirementresearcher.com/. Download their free eBook, 8 Tips to Becoming A Retirement Income Investor at retirementresearcher.com/8tips

In this episode of 'Retire with Style', Wade Pfau and Alex Murguia discuss the complexities of market volatility, its implications for investors, and the current economic landscape. They discuss the nature of volatility, the significance of the VIX as a measure of market fear, and the emotional toll of daily market fluctuations. The conversation also touches on the impact of tariffs and inflation on the economy, emphasizing the importance of understanding these factors for long-term investment strategies. Alex and Wade discuss the current state of the market, focusing on the impact of the technology sector, government spending, and economic volatility. They explore historical market risks, investment strategies for navigating uncertainty, and the importance of controlling investment factors. The discussion emphasizes the need for a well-thought-out investment strategy that aligns with individual preferences and the realities of market fluctuations. Listen now to learn more!

Takeaways

• Market volatility is a significant concern for long-term investors.
• Understanding the VIX can help investors gauge market sentiment.
• Tariffs can have complex effects on the economy and consumers.
• Investors in the distribution phase are more vulnerable to market downturns.
• The emotional impact of market volatility can affect decision-making.
• It's essential to focus on long-term investment strategies rather than daily changes.
• Economic growth and inflation are interconnected factors influencing market conditions.
• Understanding market dynamics can help investors make informed decisions. The technology sector is currently a significant drag on the market.
• Government spending cuts can lead to increased economic volatility.
• Historical data shows that missing key market days can negatively impact returns.
• Diversification can mitigate losses in a globally diversified portfolio.
• Investment strategies should align with personal comfort levels and financial goals.

Chapters

00:00 Introduction to Market Volatility 04:20 Understanding Market Volatility 10:06 The VIX: Fear Index Explained 11:57 Market Movements and Emotional Responses 16:21 Current Market Conditions and Influences 25:11 Inflation and Its Impact on the Economy 27:28 Market Trends and Technology Sector Impact 29:55 Government Spending and Economic Volatility 32:34 Historical Market Risks and Uncertainties 35:05 Investment Strategies for Market Volatility 41:21 Decision-Making in Uncertain Markets 46:07 Controlling Investment Factors

Links

Watch this episode on YouTube: https://youtu.be/6nCikqRDcTw

Missed the webinar? Sign up now to get access to the replay of the Retirement Researcher webinar called, "Understanding Market Volatility and What It Means For You": https://retirementresearcher.com/rws-market-volatility-replay

Missed the webinar? Sign up now to get access to the replay of the Retirement Researcher webinar called, "Understanding Market Volatility and What It Means For You": https://retirementresearcher.com/rws-market-volatility-replay

The Retirement Planning Guidebook: 2nd Edition has just been updated for 2025! Visit your preferred book retailer or simply click here to order your copy today: https://www.wadepfau.com/books/

This episode is sponsored by McLean Asset Management. Visit https://www.mcleanam.com/retirement-income-planning-llm/ to download McLean’s free eBook, “Retirement Income Planning”