MoneyWatch with Jill Schlesinger Is a Cash Deferral Plan a Good Idea ?
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Dec 28, 2025 Explore the basics of a cash deferral plan and its tax implications. Hear Eloise's financial goals as she prepares for retirement in five years. The hosts discuss how to model retirement expenses and the potential role of part-time work. Emphasis is placed on diversifying concentrated company stock for greater financial security. Is deferring cash a wise decision to manage taxable income in retirement? Tune in for insights and practical advice on maximizing savings!
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Use Tax Deferral To Shift Income Timing
- Max out employer retirement contributions like a 401(k) before other moves when possible.
- Use tax-advantaged deferrals to push taxable income to years when your tax rate may be lower.
Snapshot Of Eloise’s Financial Picture
- Eloise is 49, single, earns a base of $180K plus RSUs and bonuses, and already maxes her 401(k).
- She holds about $250K in company stock, $130K in savings/CDs, and small brokerage balances.
Low Spending Makes Early Retirement Realistic
- Low living expenses give Eloise flexibility to retire early with modest income.
- Part-time work after early retirement makes the plan more resilient to shocks.