Influential Entrepreneurs with Mike Saunders, MBA - Interview with George McReynolds Founder of McReynolds & Company Discussing Inflation and Safety Jaws

Episode Date: September 28, 2026

George McReynolds, CFP® is a veteran wealth manager, tax strategist, and best-selling author who has spent four decades at the intersection of money, taxes, and real-world decision-making.After leaving public safety in 1985, George entered banking, where his early grounding in tax fundamentals made him a natural fit for working with business owners and affluent borrowers. He became a go-to resource within private banking circles, earning what he describes as a “ringside seat” to how wealthy families actually manage — and mismanage — money.In 1994, after discovering The Great Boom Ahead by Harry Dent, George returned to school to earn his Certified Financial Planner™ designation. Around the same time, he opened a tax preparation practice and worked inside a high-volume tax firm preparing blue-collar returns under intense time pressure. Then followed a CPA firm serving business owners and high-net-worth families. That experience gave him an unusually broad view of the tax system — from the simplest returns to the most complex.After passing the CFP® board exam, George was recruited to a prestigious investment firm on Philadelphia’s Main Line. Soon after, he launched a comprehensive financial planning program inside the credit union of a major pharmaceutical company, where he helped more than a thousand pharma employees and retirees navigate retirement, taxes, stock compensation, and benefit decisions.In 2001, George published his first book, Prosperity by Design, and became an independent advisor. Since then, he has authored or contributed to multiple books, including The Longevity Trap, Defuse the Tax Bomb, Uncle Joe’s Gems, The Pension Shield Option™, Stop, DROP and Roll, Retire Abundantly, and Expert Stories and he wrote the foreword to The New Holistic Retirement, and 9 Money Mistakes Doctors Make.George has spoken internationally at venues including Oxford University, the Royal Society of Medicine, the London Stock Exchange, the Harvard Club of Boston, and the FBI National Academy Association. He has been featured in CNN, the Financial Times, Yahoo! Finance, Business Insider, and Philadelphia Life magazine.Defuse the Tax Bomb distills the framework George developed after watching too many successful families lose hundreds of thousands of dollars to taxes they never saw coming — not because they made bad decisions, but because no one showed them how the system actually works over time.Learn more: https://www.mcwealth.com/Or buy the book at: https://justabundance.com/Securities and Advisory Services offered through LPL Financial, registered investment advisor. Member FINRA/SIPCInfluential Entrepreneurs with Mike Saundershttps://businessinnovatorsradio.com/influential-entrepreneurs-with-mike-saunders/Source: https://businessinnovatorsradio.com/interview-with-george-mcreynolds-founder-of-mcreynolds-company-discussing-inflation-and-safety-jaws

Welcome to influential entrepreneurs, bringing you interviews with elite business leaders and experts, sharing tips and strategies for elevating your business to the next level. Here's your host, Mike Saunders. Hello and welcome to this episode of Influential Entrepreneurs. This is Mike Saunders, the authority positioning coach. Today we have back with this George McReynolds founder of McReynolds and company, and we'll be talking about the inflation and safety jaws. George, welcome back to the program. Thanks for having me again, Mike. It's been a pleasure with the other.

Yeah, you know, I'm enjoying this series on the jaws, like the traps and the teeth and the jaws. Like, we don't want that to snap. We don't want to get caught in it. Tell me how to avoid it. And now we're talking about inflation. And I know that's super, super confusing because what actually is inflation? And how does it go up and down? And how does that affect me?

And a simple, you know, example that I would say is, you know, you're $1. dollar today buys something, but in two, three, four years, it buys a whole lot less. So get us started with how do you start working with your clients and talking about the inflation aspect and what they should be doing to prepare for that? Well, now that inflation is back down to what people think is a reasonable level around 3%. A lot of people think they can just disregard it. But add that up over time, Jeremy Siegel, professor at the Wharton School, University of Pennsylvania did a 200-year study on inflation in the United States.

And even at 3%, in 24 years, your cost of living will double, or the value of your income will be cut in half. Now, we don't have to go out 24 years to see something like that. If you'd retire January 1st of 2021, by January 1st of 2025, your pension. without a cost of living would have shrunk by 25%, but you would not have seen it. It would have been invisible to you. But a couple of years ago, we had 9.7% inflation. It was the highest since like the 80s.

So it's all over the place. I've studied, I pulled the charts myself, going back 100 years. But I actually met Jeremy Siegel last year in San Diego at a focus conference. It was such a pleasure to actually see him in person. He wrote an incredible book called Stocks for the Law. run. But again, he analyzed all of this over 200 years. And the problem is that the only way to beat it is by investing in companies, in solid companies, in stocks. And that's where the safety comes in. And safety is the most expensive word in retirement. That if you're really trying to focus on the short term safety, your money is not going to keep up with inflation. Even over 10 years at 3%, that that, that, that, will knock your income or your cost of living will have to have to grow by almost a third. And that's just in 10 years. So the average person could expect to retire and live 10 years.

The people that I work with, they could expect to be 20, 20, 30, 35 years when we count the survivor that's going to end up in retirement as well. So back in 1970, was the 71, 19, 71, Richard Nixon declared an emergency when inflation hit 4%. And in the period of the 80s and in the 70s, it was just kind of out of control. And real estate and gold did not do as well over time as stocks. The short term, the one to three year period was stocks, that's what scares people. So that's where we came up with our three bucket approach. So we put things into safety growth and income.

So the trick to being able to invest in stocks is not having to sell when stock prices are down. And we do that by having a safety bucket. So we have anywhere from two to four years of a person's expenses in a nice safe bucket. So they don't have to sell anything when the market is down because it will happen. But over time, stocks have roughly averaged six and a half to seven percent more per inflation. If you just kept your money in the mattress, you're actually losing it invisibly each year. Bonds have not worked. And we saw in 22, bonds did worse than stocks in 2022.

Yeah. So the way we've always done it might not be the best way moving forward in some cases. Yeah. And even gold, which people say is an inflation hedge. It's near zero real return over time, whether we're measuring the 40s to 70s or whether we're talking about post-1926 against stocks. Now, there are ways to invest in. There's ways to make the medicine taste good.

But the problem isn't the stock market. The problem is trying to deal with inflation without having stock. You know, in your teaching and writing, you say that safe can be a really expensive word in retirement. Why is that? Because it doesn't keep up with inflation. that bonds may average about 3% over inflation. And so it's just not keeping up as prices are going up. And frequently, we see these bursts of inflation.

It's not a steady average 3% inflation. It's all over the place. During some of the Biden years, we had as much as 9.7% inflation. And now we're back down to the 3% percent range, but I don't know how long it's going to stay here. but when we do financial plans, we model lots of different scenarios. So we start at a 3% inflation, except for healthcare, which we model at 7%. For education, we use 9% inflation.

And then when we stress test the plans, we simulate what if we hit 4%, what if we hit 5, what do we hit 7%, what does it do to the plan? And isn't there an element of compounding? Like if you're, if you had 3% inflation this year and next year it went to four, it's not a static number because you're kind of creeping in with that compounding effect. Exactly. It's compounding. How often does, you know, other than in the 30s, when does inflation numbers go down? Yeah.

There might have been one year during the Reagan years where we actually had deflation. What we have from time to time is disinflation, where we have a lower of the rate of inflation. but even at 1% compounding, that that'll dig into things if your money's not keeping up. Yeah. And it's a silent killer because you don't see it. You get a statement and your dollar amount didn't drop. But when you go to Aldi, when you go to the store, then you need to put more on the debit card. Well, and we think these big words like inflation and deflation and stagflation, all these things.

but in reality we know what it is because how much are we paying for gas? How much do we pay for milk and food? Like to your point about going to the grocery store, we feel it. And I know that you can look back and go, how much was milk two years ago? And I'll bet it was that it's gone up in the last two years. So your buying power is impacted. So yeah, you might put a number down for retirement and say, I need this number every single month in retirement to pay my bills.

but if inflation has been squirrelly, you might need more than that, but you don't know how to calculate it. So doing that stress testing is super important. And I know that sometimes people feel like, well, you know, I'm going to avoid that safety job because I've got a pension. That sometimes not is the salve. It's not. It's actually really scary. Even with with cola. So very few private pensions actually have a cost of living adjustment. I work with a lot of.

public safety people. And sometimes they have some cost of living, but sometimes it won't kick in until it exceeds 2%. Sometimes it'll only be for three or four or five years, and then it stops. And you can't count on the cost of living. And the thing is, it's invisible. It's like carbon monoxide. You can't see it. You can't smell it, but it's killing you. So again, if you retired with a $100,000 pension in January 1st of 2021, you could only buy. $75,000 worth of stuff on January of 2025. You took a 25% pay cut, but you never saw it coming. Wow. That's a real thing. And similar to some of the things we've talked about in the series of, you know, well, if you need this expense, but it, you know, you're not prepared for it. It hits you

between the eyes. Same with inflation. If you plan for it, but inflation doesn't do what you plan for, good. But at least you had that baked in. That's a, big piece is that planning and planning well ahead and not ignoring things. And I know that's what you do with your clients to say, look, let's plan for every contingency and then we know we're covered. Yes. I'll give you one real quick story. I worked at a credit union of a big pharmaceutical company. I started some financial planning program for the company. And when I first got there, I'm thinking I'm going to be doing stock options and investing in 401Ks and everything. But the people from the credit union

were sending people over to me, basically for credit counseling, where they had retired and interest rates and CDs, they could get 13 and 14% CDs. And they just thought they had it made. They kept the money in the CDs, which in my, my

dictionary means certain death. So as interest rates went down from 13 to 14% the next year to keep the same spending, they had to dig into the principal. And then the next year, the same thing in the same thing. So these lump sums that they had when CDs were 13 and 14 percent, they were completely wiped out. And the people of the credit union were sending them over to me on how do I,

how do I get them out of the hole that they dug with those safe CDs? Yeah. Huge. And safe, I know, air quotes, because in reality, they are safe because they're not going to go down, but they're not the best tool for you. And so many times we as humans, as Americans, we hear this from the water cooler or our friend at work or we Google something or we listen to some talking head out there, but it might not be the case for you. Let's shift gears a little bit and talk a little bit about the aspect of market volatility. And we can't control that, but it's like this turbulent storm on the sea, these waves hitting you. Number one, at any time, because volatility means it's up and down and all around. But it's especially troubling when you have.

have to take money out of the market. So like when you have your required minimum distribution or when you're retired, you have to take your whatever amount per year. Talk a little bit about that aspect, which is called sequence of returns risk. But I think that phrase tends to confuse people a lot. Yeah. So it's whether you call it timing or sequence of return. In the book, I have an example of, in the appendix, I talk about constants gains and

ups and downs. So they retire on the same day and they're taking the same money. And Constance takes out a real conservative portfolio and over 10 years, her return averages 8%. Ups and downs, his portfolio averages 12%. But at the end of 10 years, Constance has more money than Upsen. Because as his was more volatile, when the market was down, he had to take more money out. And even though he had a higher average return, he had less money at the end of the 10 years.

I also talk about will he be rich and Betty won't. So will he be rich and Betty won't retire on the same day with the same amount of money. And they get the exact same return over time. But if they started out with $100,000 at the end of the time, Willie be rich ends up with $2.7 million. and Betty won't go broke at age 80. And what happened is the returns, although they had the same exact returns, they weren't in the same exact order.

So if we reverse the order, Betty went broke. And again, she was planning for the average, but there were the ups and downs. So there's a couple of things that people can do. Number one, there's the three bucket strategy. So make sure that you've got enough in the safety bucket to not have to sell when things are down. also diversify your portfolio. So investments are risky, but they're not risky at the same time.

So if I have a stock in a company that makes umbrellas, a stock in a company to make solar panels, they're not going to be risky at the same time. When it's rain and the umbrellas are going to do good. When it's sunny, the solar panels are going to do. So putting those together, that reduces the risk to diversification or which called modern portfolio theory. So that really helps. But having that safety bucket, not having to sell when your portfolio goes.

down is really important. There's also an income bucket. So we look at the money you're getting from dividends. Jeremy Siegel talks about over time, dividends make up 50% of the total return of a portfolio. So the money that's coming in dividends and interest as well as pension and Social Security. That is money that you don't have to take out of your portfolio. And the money that you do have to, you have to have two to four years in a safety bucket to avoid that. There's also buffered investments where by investing through an insurance company, they can

guarantee that they can make sure that your portfolio won't drop by a certain percentage, whether it's 10% or 20%, and now they could also say that your portfolio will never go down. You're giving up the upside for that, but you're protecting the downside. If we look at the S&P 500, if you had $100,000 on the turn of the century, and you put it in the S&P 500, your average return through the end of last year would have been 7.7% per year, which is pretty good. Where if you put it into a Buffford investment and just took out, it got a 0% floor, but a cap of 11%, your average return would have been 6.6% per year, right? But it would have taken until 2019 for the S&P 500 account to actually match the Bucon.

growth account, right, because of all the down years with the, you know, 2000 with the dot coms, 2001 with 9-11, the financial crisis of 2000. It wasn't until 2019, 2019 that it broke even. It surged ahead 20%. And they came right back down to where the buffered growth was. And who knows? So it's high now and a 7.7% return. But who knows where it's going to go next year?

So again, these buffered investments, you're giving up some of the upside, but you're also giving some protection on the downside. So it's buffering the loss, whether it's 10%, 20% or even 100% buffer on the downside with these insurance companies. You know, and I think that that, when I hear that, I go, man, I would rather be that tortoise than the hair. If you're sprinting, sprint and sprint and you run out of breath and then you take some losses, you know, so to speak, well, that tortoise is steady plotting.

If you can't lose money and you have a little bit of a cap here and there, but at least you're steady plotting forward, that's a great position to be in. It gives you that peace of mind, doesn't it? And what we do is we do something called Monte Carlo simulation. And what we do is we have all this data that goes back literally 100 years from 1926 until 2025. And we're not saying that that's what's going to happen, but we're saying that represents the universe of what can happen. And if we've got a client, a new client that's going to retire, we're looking out at a 30-year retirement. We will simulate 1,030-year retirements to see if they're playing works. So it shows us the impact of that sequence.

So every once in a while, we get the Great Depression, followed by World War II, followed by Vietnam, and that'll show up in these simulations. And we'll get a good feel for what's the probability of success. In the book, The Longevity Trap, when I thought the book was done and people were looking at it, they came up with some questions, and I added a 25-page appendix. And one of those things is just explaining what sequence of return risk is looking at ups and downs, but also with what is monocor simulation, what it is, but also what it isn't. So again, we will simulate 30,000 years of investing to test the plan under most circumstances,

and then we will further stress test it based on what if the bare market happens in the beginning. What if social security is cut? What if your pensions cut? What if you need money for long-term care? So we simulate these. What if your taxes go up? and we stress test the portfolio. But again, we're simulating 30,000 years,

and it's telling us what kind of sequence puts us at risk. Now, by looking at 30 years, we don't have to react to every headline that comes off of CNBC. You know, if we're figuring that we need a new car every seven years, if we get into a bad run, could we make the car last an extra year? Or what I like to say in the vacation fund,

in the good years you go on the cruise, the bad years, you have to stay home and watch a love boat. Yep. You watch it from the sidelines. So let's talk about something. I love the word balance in my life. It's like, hey, if you do too much of one thing, that's not great. If you do too little of one thing, that's not great. How do you balance both of these risks, both safety and inflation? Because if you go too much on the safety side, then you've got all your money and CDs and you're not keeping up with inflation. So there's got to be a balance or a mindset there. And I would suspect from my uneducated opinion, it's never set it and forget it. So if you put something in place, you've got to check it and check it and make sure that it's doing the right thing, right?

Well, imagine if you went to a dentist, Mike, and the dentist said, hey, Mike, what's your pain tolerance? Because, you know, I can do a root canal in like 11 and a half minutes. And you'd cover your mouth and you'd say, Doc, I want you to take the whole freaking hour, right, and minimize the pain. But if you went into one of these big wirehouse investment companies, they'd give you a little form and it would measure your risk tolerance. And then it would create a portfolio. So at some point, you would experience that risk. But our approach, again, with the monocardos simulation, first we figure out how much risk do you need to take to make your money last for your whole life and for whatever legacy you want to leave. So, again, it's measure.

Uncle Joe said, measure twice and cut once. So we measure that. Again, we use, again, a thousand, 30-year retirements to see if it works that way. And how much risk, then we'll work with a different risk level. So if we want people to balance. So if there's a 70% probability or less, they don't have a good plan. They're in uncertainty. Ideally, it should be 70 to 90% probability of success of their plan.

If it's above 90%, that means. means they're living in sacrifice. And sacrifice, that's having too much money at the wrong end of the plant, right? And would you rather have $100,000 when you're 92, Mike, or would you rather have $95,000 when you're 62? Or which would be more fun to spend? Yep, the bigger one, yeah. Right. So again, so we target that and then we test it based on, well, if we take this much risk, then this is how long your money lasts. If we take less risk, this is our probability. So if we have a 99% probability of success, why do that? Let's take less risk and make your plan work.

So we get it down to 90% by taking less risk. So again, it's a lot of measure. It's a lot of simulations. But it comes right back to what Uncle Joe said, measure twice and cut once. And we measure it against simulating 30,000 years of investing. And we'll do it with 10 different portfolios to see which is the optimal thing for them. and measure twice cut once but also talk a little bit about that reevaluation because there's so many things we've talked about in this series so far that are out of our control like market volatility and inflation and taxes so when you put a plan in place and you stress testing go here's the plan should you be checking it once every five years once every five months to make sure that these external factors aren't impacting the plan that needs a little tweaking are Wealth management plans are updated every single night after the market closes.

Again, that 30,000 simulations, it's run every night based on the balances of the account, based on the return simulations, based on the correlation of the different investments. Every single night, so the client can go in. So instead of looking at their statements every night, which is an historical document, right, to go online and see how much money I have, that's like the Magna Card. That tells you what happened before, right? but our financial plans, we're looking at, are you in the channel for living the life that would really give you a compelling, compelling future and legacy? So that's how they can do it every night.

But otherwise, we have quarterly plan reviews with our clients. We do a virtual meeting with 99% of them. And we walk them through the plan. We update what their goals are. Is anything changed in your situation? and again, whenever anything changes in their life, they can call and we can do it. So we do the quarterly wealth management reviews, and then we do twice a year, we do their tax planning reviews.

Awesome. And that keeps things dialed in, and I think that helps to make sure that balance is in place. Well, George, if someone is interested in picking up copies of your books and reaching out and connecting with you, what's the best way that they can do that? Well, you can get a sample of my books and order them at justabundance.com. And if you wanted to see if there's a fit with working with us, then just go to talk toge.com. And you get another view of the whole practice at Mickwealth.com, MCWealth.com. Well, George, thank you so much for coming back on.

It's been a real pleasure chatting with you. Thanks, Mike. You've been listening to influential entrepreneurs with Mike Saunders to learn more about the resources mentioned on today's show or listen to past episodes. Visit www. www. influential entrepreneursradio.com.