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Episode #498 - The Impact Of Alcohol On Rocking Retirement
Roger: "It is no measure of health to be adjusted to a profoundly sick society." -Krishnamurti.
This is Roger Whitney.
This is the Retirement Answer Man show, dedicated to helping you not just survive retirement, but have the confidence to lean in and rock retirement because you're doing the right things consistently. Always about consistency.
Today on the show. We are going to answer some of your questions about Roth IRAs. In fact, we'll probably do a lot of that throughout the month of August. In addition, next week, I think I said it was going to be this week. It's going to be next week where I outline a framework to think through. In an organized way, whether you should do Roth conversions as part of your plan. I'm postponing it for a week for a very important reason.
I just got back yesterday from my COVID-versary makeup trip to Europe with Shauna, my high school buddy, Eric, and his wife, Chris, and I'm a little jet lagged. I worked on it as a puzzle throughout my vacation. Not as work, but just as a puzzle, and I wanted to give myself a little bit of extra time so we could review that.
So we will be answering questions on lots of Roth scenarios this entire month in August, which is going to be mainly a Q& A month which we'll answer a lot of your questions today, but today we have Dr. Bobby DuBois on for a Bring It On Energy segment and we're going to have a thoughtful discussion about our relationship with alcohol and how that impacts rocking retirement, but for now, let's move on and get ready by entering some of your questions
LISTENER QUESTIONS
Now it's time to answer some of your questions. If you have a question for the show, you can ask it at http://www.askroger.me and you can leave an audio question, you can type in your question, and we'll do our best to answer it on the show.
I'm going to guess that now we're in August, we're going to have a lot of questions related to Roth IRAs and Roth conversions. There's definitely a lot to explore there beyond this series. Hopefully this was a good primer for you.
ON CONTRIBUTING TO A ROTH VIA 401K
So, our first question comes from Jeff related to Roth contributions.
Jeff says,
"Hey, first of all, I love your show and recommended to everyone."
That's awesome, Jeff. We appreciate that.
"I just listened to the podcast on Roth contributions, and I noticed that you did not mention what I have found as a keyway to save Roth monies for these tax-free assets. My 401k allows me to contribute after tax dollars to my 401k in addition to my normal Roth contributions up to the max employee plus employer contribution limit, which was 73, 500 for him over 50. Then I'm allowed three times per year to roll over that after tax money in my 401k, to a Roth.
This is a great way to get more money into the Roth, and I wanted to make sure that you talked about that in addition to the backdoor approach."
That's a great example, Jeff. I think we hit on it briefly when we were talking about Roth conversions. This is a rare opportunity that you have, Jeff, to be able to make these after-tax contributions, and then the employer giving you a chance to roll those over. Obviously, you're going to have a big tax bill related to that, but if you're already saving in after tax assets, that can be a big plus.
I would say that this is a rare thing. So, you can check with your employer if they offer this type of plan, because they have to proactively build that into the 401k plan adoption agreement, and you can check your summary plan of record or contact your benefits department to check that out. But thanks for sharing that, Jeff.
GETTING PUSHBACK FROM ADVISORS ON CONVERTING A 401K TO A ROTH
Our next question comes from Louise related to Roth conversion strategies.
"In this week's podcast, you mentioned that while Roth accounts have become available since the 1990s, most folks don't fully understand them. Therefore, many 'baby boomers' are stuck with 401ks, that is me."
Well, stuck, I don't know if that, stuck is the word. Maybe I did use that word, I don't know. But it definitely creates tax complications later in life for sure.
So, Lee says,
"But the problem I have today is that I continue to get pushback from advisors on wanting to do significant IRA to Roth conversions.
I'd like to take my 700, 000 IRA and convert 350, 000 in 2024 and 350, 000 in 2025 and just be done with it. Yes, I know I'll pay the high taxes in those two years, as well as Medicare surcharges via IRMA. But then I'll be 100% done, and all my growth and income from my Roth will be 100% tax free."
Here are some details.
Louise says,
"I'm 65, my husband is 68, we currently have an effective tax rate of 18%. I've calculated my effective tax rate if I were to do these conversions, and it would be in the 22% bracket for those two years. I plan on having 30 years of longevity and am very healthy. My husband has some health issues, so it's likely I will be single in 10 to 15 years."
Then Louise finishes with,
"Why are even today's advisors slow to encourage Roth conversions? I get pushback regularly and there are so many positives to having all of my money in a tax-free account to grow and grow and grow and grow and grow, and I feel like there is a level of peace and security along with it as well."
Well, let's take a look at this, Louise.
So, if you do the Roth conversions as you plan, what are you going to get for that? Well, number one, you're going to lock in your tax rate, which you have an effective rate, you said of 22%. I'll trust you on that. You're going to lock in that tax rate on that 700, 000 and just go ahead and pay the tax on it, and you're going to lock in the tax rate for your beneficiaries. Assuming there's money left over for your beneficiary; you basically eliminate future tax increases related to these monies.
In addition to that. As you stated, your husband has some health issues, so you've also locked in that 22% effective tax rate for you, assuming you survive your husband, where you'll go from joint tax brackets to individual tax brackets and the significance there potentially could be that yes, we could have tax increases in the future and we know we're going to sunset the current tax code and go back to one that has us accelerate up the tax brackets a lot quicker and we'll have future information on that. It can be exacerbated if you are going from a joint bracket to a single bracket, so you could find yourself in much higher tax brackets later in life because of the fact that statistically you're thinking that, hey, I'm going to be a single person for a good portion of this retirement. So that's one thing that you're getting by doing these significant Roth conversions.
Another thing that you're getting is you're going to eliminate any required minimum distributions in the future for at least this 700, 000 if you were to roll it over 100% to a Roth account, meaning that down the road you're not going to have forced withdrawals that potentially could cause you to go up the tax bracket scheme again.
Then lastly, what else are you going to get with this, Louise? Well, you're going to have increased flexibility on realizing future income, meaning that down the road, when you decide to pull money from your assets, you're going to have this huge tax-free bucket to pull money from that won't impact IRMA, that won't impact the tax rate, that won't impact social security, et cetera, at least under the current scheme.
I think you know all this, but from answering it, I'd like to talk through this logically.
So, there are a lot of positives there, Louise, and what do you give up for that? Well, the impacts are you pay 22% tax bracket on 350, 000 over two years, which works out to 154, 000 in a two-year period. So, in order to get those benefits, you're going to have to pay out $154,000 over two years to pay the tax that 22% on the $700,000, assuming you pay it with after tax assets, and it's assumed you're going to have less money to spend to save, to gift, to grow, to pay down debt in after tax assets. If it's coming from the conversion itself, then you're going to have a lot less money growing and growing and growing and growing, as you said. The difference is that's going to be true money, right? Because you don't have this tax cloud hanging over that amount.
Then, as you mentioned as well, over those two years, you're going to have IRMA surcharges on your Medicare. Which work out to almost 3, 800 per year for those two years that will happen down in the future. Some of these numbers will adjust when they actually hit. So that's what you're going to give up.
You get pushed back regularly from advisors, and then we'll go to some information that you might want to gather I'm assuming. If you haven't already, think through this logically.
You had said, "you get pushback regularly from advisors." Well, a good advisor will know your entire situation and help you get to a judgment call. Because a Roth conversion ultimately is a judgment call. It's not going to be crystal clear in 99% of situations. Pushback from someone, whether they're an advisor or someone you're talking to, like me, who doesn't know you or a friend, really shouldn't have any impact. Because if you're talking to lots of advisors or lots of friends or even in forums, they may be able to tease out some blind spots that you haven't thought about, but if they don't know your entire situation, I wouldn't put much. credence in their counsel because they don't have enough information to give you wise counsel. So, a good advisor will help you think through it logically just to get that judgment call, and they should give their opinion. It doesn't mean that they're necessarily right all the time.
What information could the random advisor or the random friend not know in terms of thinking through this logically?
So, information that you'd want to have mapped out so you could create some what ifs, and obviously you need a feasible plan of record that's resilient already before we even have this discussion, is your future cash flow.
I think you mentioned this year, you have about 190, 000 in income, with you 65, your husband's 68. What does your future cash flow look like in terms of your income? What amount of income will you have, say, over the next 10, 20 years? What is the source of that income, so we know how it's treated tax-wise, that's going to be important to know.
The second thing that's going to be important to know over the same time period is for you and your husband to live your great base life plus the extras, how much will you need to draw from your financial assets to supplement whatever income you have in order to live that life? We want to know that year by year, at least some estimate of it.
Next, we want to know what type of assets you have. I know you have a 700, 000 IRA. I don't know if you have other IRAs, or your husband has other IRAs, or what your after-tax assets look like, to determine where you're going to draw to meet what, if any, deficit you're going to have. These things need to be mapped out to really get to a better judgment call at the end of the day of whether you convert the 700, 000 or not.
Then you want to explore what other levers do you have that can help you manage, say, the tax code. We'll just focus on that one for now. Do you have charitable intent now or in the future? Because that could have a play. I have a client right now where we're doing the maximum qualified charitable distributions, where you are doing that in an IRA in order to lower required minimum distributions, not just now and in the future, and actually doing some advanced planning on charitable intent when they were to pass, which eliminates a lot of this tax issue that we're talking about. So, you want to explore all of those things.
The key question you want to come back to, Louise, is what are you trying to solve for? Is it for your future RMDs and the fact that you're going to be likely single because of your husband's health issues? Is it to pass it to the kids? Is it to manage IRMA, to lower RMDs?
You stated "peace and security" a couple times, I think twice in your comments to me. Is that what you're trying to solve for? If it is, I think 22% tax bracket is a reasonable tax bracket given that you have the 700, 000 IRA. You know there's a tax cloud floating out there that you will have to pay or somebody's going to have to pay at some point in time.
If your calculation is, hey, I'm cool paying my tax now, being free of the IRS related to the 700, 000 and just let that money grow and I'll have optionality later on. If that's a high priority. If you've thought through these other things that we've talked about, who cares what anybody else thinks?
Nobody's going to have the right answer on this one. So, from that perspective, if you're crystal clear of what you want to solve for, and you've walked through it in an organized way, fine. That sounds great to me.
HOW DOES THE FIVE-YEAR RULE APPLY TO A NEW ROTH ACCOUNT?
Our next question comes from Dan.
"How does the five-year rule pertain to a Roth 401k that had been open for 10 years?
I retired at age 66, and I rolled my Roth 401k into a Roth IRA that I just opened. I then closed my Roth 401k account. I then rolled a small amount of my traditional 401k into my Roth IRA. Can I withdraw the converted traditional 401k earnings from my new Roth IRA before the five years without paying tax on that amount?"
He puts in that he is age 66. So, number one, in terms of the five-year rule, Dan, the five year rule started on the date the first dollar went into a Roth IRA. So, although you've had this Roth 401k open for ten years, when you rolled that over to a brand-new Roth IRA, that clock reset. And that's one reason a good strategy is to have a Roth IRA open and funded as early as you can, so when you have a Roth 401k that you roll into it, you don't have to worry about the reset of the five-year rule in terms of withdrawals.
Now, in terms of the Golden Rule, you've hit one of the two parts of the Golden Rule, and that is you're over 59 and a half. To determine how you would be taxed on it, you would want to look at the ordering of withdrawals from a Roth IRA. The ordering is, first, it's going to be contributions, and since you're over 59 and a half, you'd have no penalty or tax on that.
Once you've withdrawn the maximum of your contributions, then it would look towards conversions, and you just did a conversion of a small traditional 401k to your Roth IRA, so you'd have a conversion there. Because you're over 59 and a half, the conversion would have no tax but if you continue to withdraw money and you had earnings, so you've already withdrawn all of your contributions, including that rollover, you've already withdrawn the amount of that conversion from the traditional to the Roth. Because you are over 59 and a half, there'd be no tax or penalty on that. But if you continue to withdraw money within that five-year period of the establishment and first dollar going into the Roth, you could have tax on additional amounts that are considered earnings. Does that make sense, Dan?
So even though Roth hasn't met the five-year rule, you can take out your contributions and roll over with no problem. You can take out the converted amount with no problem, no taxes, no penalty, because you're 66. But if you draw anything that is considered earnings, because the account is less than five years, then you would pay tax on the earnings amount.
I said that again just to clarify it for myself. Hopefully that helps you in your planning, Dan.
ON IMPLEMENTING A RESILIENT PLAN
All right, our next question is one of my favorite types of question, which is an audio question from Joe.
Joe: Hi Roger, this is Joe from New Jersey. I am 64, retired for two years, and my wife is still working at age 60, but will retire at 62.
So, let's just use a $2 million portfolio for illustration where $1 million is in laddered CDs and bonds, and $1 million is in ETFs. Our plan is to use the income from the laddered CDs to fund part of our five-year plan you always talk about. Quite frankly, I'm unsure what to do with the maturing CDs once rates come down again.
Nonetheless, my question is about sector allocation in regard to portfolio percentages. So, let's assume I want 50% of my portfolio in a core fund. Should it be 50% of the overall 2 million portfolio or 50% of the 1 million in equities? Or is that just a personal preference as I currently use the ladder method?
Your podcast is the best, Roger. Thank you so much for everything you do. Bye.
Roger: Thanks for the question, Joe. And enjoy your time as a kept man while your wife is still working. That's awesome.
It's a good question here. So, this is an optimization resilience question, a little bit of both, on how do you implement a resilient plan? Because you have a couple different pathways here, Joe.
So, 2 million portfolio. One million of that is in laddered CDs. that you are living off the interest. So, you don't need the principal, but they're generating enough interest for you to supplement your life outside of all the other income sources you have.
Then the question is, what do I do with this remainder amount if I want to have a 50/50 core equity core bond portfolio? I'm going to use that phrase and make that assumption here.
So, there are two basic pathways to go here. Number one is, if you are using the interest, but the principle of those bonds is being reinvested, in theory, back into the ladder, and to implement a ladder approach, really, it is about always building that next rung as part of your "bond" or fixed income portfolio. So if you're just simply taking the interest and you're trying to figure out how you allocate the rest of it, and you want a 50/50 overall bond stock allocation, then yes, I would take the 2 million amount, assume that your fixed income portion is this 1 million bond ladder or CD ladder in your case, and the rest of it would go into equities, right, to achieve that 50/50 mix.
The other pathway that comes to mind is you can create a ladder, say, of 5 or 10 years of the money that you know you're going to need to spend. So let's assume that's 50, 000 in this case, which would be 5% of a million dollar bond portfolio. Let's assume you need 50, 000 a year for the next 10 years from your financial assets to help supplement your lifestyle. If that's the case, you could do it another way, which is to build a five or whatever period of time income floor that you want to have.
Let's assume it's five years. So, five years times 50, 000 a year, we'll call that 250, 000. You could build a income floor of CDs or individual bonds that will mature in one through five years, and rather than just use the interest, you're actually just going to spend the money. You're just going to spend the principal and whatever interest over those five years. If that's the case, then you look at the rest of the portfolio, which is now one and a half million dollars. And you say, I want to have 50/50 allocation of bonds and equities for that portion, then you would do 50/50 based off of that 1. 75 million that are left over. You would do the 50/50 allocation.
Is this personal preference?
It is, but that's personal preference also based on understanding the totality of your situation. Two things go into this decision, I think Joe. One is to make sure that you have enough runway, I would say five years is the baseline, and you can dial that up or down based on your situation, where you know exactly how you're going to pay for life to supplement whatever income sources you have. That's the number one we have to solve for.
Number two is the allocation of the rest of the assets needs to be an allocation that has a risk return profile that you're comfortable with over the time period that it's going to be invested in, and that is just literally math of what are my odds. What's the average annual return over, in this case, say, a five-year period? What's the worst-case drawdown that we've ever seen? What's the best case? Am I comfortable? Because all we're trying to do with the upside portfolio is set it up so statistically you have a successful outcome. So, I think either is fine. The key is that you feel confident in it, and you have clarity in how you're going to pay for life.
CLARIFICATION ON THE "PRO RATA" RULE
Our next question comes from Mike related to the pro rata rule.
"Hey roger, I had a question about the pro rata rule with Roth IRAs. If the only IRA that I have is an after-tax IRA, meaning that contributions went in and you didn't get the deduction, does the IRS still enforce the pro rata rule taxes on a backdoor Roth conversion?
So, the answer is, Mike, it still does. Because you may have, depending on your timing, you may have these after-tax nondeductible contributions as well as earnings. So as an example, let's assume you put 7, 000 into an IRA. They're nontaxable. You invest that money, and you don't do the backdoor Roth contribution until the end of the year, and that money grew by 1, 000, Now you have 7, 000 of after-tax contributions and 1, 000 of pretax earnings.
So, if you were to convert that, you're still going to have that pro rata rule come into play when they're factoring the tax on the conversion.
Now with that, let's move on to our Bring It On segment. And since it's the first of the month, we're going to bring on Bobby and talk about Alcohol.
BRING IT ON WITH DR. BOBBY DUBOIS
Alright, in today's Bring It On segment, we're going to focus on probably the most important pillar, which is energy, having the energy to show up for your life and to help us build some energy as Dr. Bobby DuBois. Bobby, how are you doing, buddy?
Dr. Bobby Dubois: I'm doing well, feeling energetic and ready to talk about our new topic.
Roger: You know, one thing I appreciate about you, as an aside, is that you're fine with me calling you Bobby. Traditionally, and I've had these experiences where doctors can get very prickly about that. So, I appreciate you. Let me just call you Bobby and tease you.
Dr. Bobby Dubois: I've always been that way.
Roger: Well, thank you. So, what are we going to talk about today in terms of building energy?
Dr. Bobby Dubois: Well, we're going to talk about alcohol, and I'm not talking about rubbing alcohol that you use to sterilize things. I'm talking about the stuff that we enjoy drinking, or some people enjoy drinking, and explore a little bit about what effect it has on our mind and our body, which directly relates to the topic of energy.
Roger: So, I want to acknowledge, first off, that this is a somewhat prickly subject for some. Alcohol is amazingly integrated into culture, and I enjoy wine. So, this is a little bit of a prickly subject or a reflection that might be a little bit uncomfortable, but it's still important to talk about, right?
Dr. Bobby Dubois: Oh, I think so.
And as my kids are fond of saying, I have no boundaries. So, I share anything that happens to be inside of me. So, talking about my relationship with alcohol is easy. The good news is we're not asking listeners to divulge anything. This is an opportunity to give some. education, some insights hopefully, and then they can do with it what they wish.
Actually, a very good meetup in the club on this exact topic, and people were very candid, and it was a very good dialogue, so I hope today is as well.
Roger: Okay, so why is this important?
Dr. Bobby Dubois: Well, the prior months, we put together our toolkit of things that improve our energy and our mental wellbeing. Exercise, sleep, mind body work, nutrition, and the dreaded exposure to cold and to heat.
So today, explore something that's in essence the opposite. If those tools build up our energy, make us feel happier and more able to face the day in a positive way, alcohol undoes some of that, and I think it's important for people to understand what it does, that's you might call the good, the bad and the ugly, and then they can adjust or not adjust their relationship with alcohol.
Gail and I had a relationship shift with alcohol when we watched a podcast while we were in Jamaica, celebrating our 40th anniversary. Huberman Lab is the podcast, Andrew Huberman, neuroscientist at Stanford, and maybe we can put the link in 6-Shot Saturday, but it was a big wake up call. Not that we're big drinkers, but what we learned and what I'll share with folks in a few minutes is that even modest amounts of alcohol have an impact.
I'm not sure I want that impact. So, we're dropping what we do even lower. That's kind of why I think it's a topic worthy of discussion.
Roger: What I like about that approach, and we just had our Guided Agile Retirement Management quarterly meeting on the non-financial topic, is when you think about making incremental improvements, usually we think about adding things, and it's almost asymmetric to the thought of "what can I stop doing" which generally has a bigger impact than adding more to our already busy life.
I'm not going to stop drinking alcohol, I'll just say that right now, but I can moderate it. So, let's talk about how prevalent this is and what range we're talking about.
Dr. Bobby Dubois: So, yes, I think it's great to begin with some numbers. And I wasn't too surprised about the fact that over 60% of people drink alcohol on a regular basis, and I'm talking about adults, and these are very large surveys, so I think the data is pretty accurate. But what that means is about 40 some odd percent don't drink alcohol or do it in a very, very rare fashion.
What I found eye opening was that people who earn more money and the cut point in this study was 100, 000 are more likely to drink, not less likely to drink, but more likely to drink. So, 80% of people earning over 100, 000 are regular drinkers, as opposed to the average, which is about 60. College graduates compared to non-college graduates are also more likely to drink alcohol on a regular basis. I found that to be astounding because I would have guessed the absolute opposite but turns out that's not what the data show.
Roger: Yeah, that does seem counterintuitive to me as well. What is drinking? What's average in terms of drinking?
Dr. Bobby Dubois: Yeah, so it's important to get some baseline ranges out there so people can see where they are. On average, for people who drink, they drink between four and six drinks per week. And a drink could be four-to-five-ounce glass of wine, one beer, a cocktail that isn't a double or a triple, and that's one drink, and then four to six might be two drinks. Two times a week, or it might be one drink four or five times a week. And of people who drink, half of them is in the one to seven range. Let me preface by saying the one to seven range is the best range if you're going to be a drinker.
Roger: Can I ask you a question about that?
Dr. Bobby Dubois: Yes.
Roger: I believe from this poll, which is a Gallup poll, right? Yep. My guess is that these are self-reporting numbers, right? That's true. So when I see four to six drinks a week and I go to the doctor and they ask the standard questions, I would probably say that, but if I'm really honest, when we think of how many drinks, four to six, in science, that is a serving, right? Just like the servings on the back of a nutritional thing, and I don't know what the standard serving of a glass of wine is, but I would probably answer four to six and I had some wine last night and I would say I had two glasses. But if I went to the actual serving size, it was probably three and a half.
That's interesting in terms of how this might skew things more than because we're horrible at self-estimation.
Dr. Bobby Dubois: A, we're horrible at self-estimation and B there is a sort of social response bias of you want to answer the questions the way you think they're supposed to be answered. Now, I'm assuming this poll was anonymous and it wasn't by phone.
I don't know that for a fact, in which case people are a little more honest. If somebody's asking on the phone, I think the numbers are probably bias low, not biased high.
Roger: Okay. I just saw that, and I wanted to comment on it.
Dr. Bobby Dubois: Yeah, and about 3 million people above the age of 55 do abuse alcohol. And what's interesting is more likely in men than in women.
And it's still an issue in the 75 and above age where a quarter of women and half of men drink beyond the recommended guidelines, which is less than seven drinks a week, and on any given occasion, when you do drink only up to two drinks, so not having three drinks twice a week, but one or two drinks a few times a week fits into what the American Geriatric Society recommends as acceptable.
Now, as I'll get to a little bit later, even small amounts of alcohol will have a negative impact, and so we need to understand it. So, what the AGS says is not like, oh, great, I can do this, and I'll be totally safe. Now, there are tradeoffs.
Roger: Now, one common thought is that when you retire, you have the opportunity to drink more.
Have you seen whether that's true or not?
Dr. Bobby Dubois: The data on this are mixed because I would have predicted that people in retirement drink more. Now you could argue, well, I'm not in my stressful job anymore, so I don't need to drink as much, but there's a lot more opportunities to socialize and there's boredom and various other things that I would have thought that people drink more, but this is on average.
I think if you live in the villages, and I really know nothing about the villages, but I'm told that socializing is a really big deal, and for lots of people, socializing includes drinking alcohol. So, I suspect there are some people who drink significantly more now than they did when they were working, but the data isn't clear for the average person.
Roger: Anecdotally, I have clients that have moved from say golf club communities, because they were like, I can't handle this. I can't handle this pace. We're all driving around golf carts. We're socializing. It's so easy, then alcohol is always involved.
So, a lot of that part of it, I think, in my experience working with clients, is you have to set up your environment to promote the kind of life that you want, and if you're around a bunch of people that drink all the time, you're just, even if you try to moderate it, you're going to be pulled in that current.
Dr. Bobby Dubois: I think that's very accurate.
Roger: So, we know alcohol affects us. What's some of the good and bad?
Dr. Bobby Dubois: Well, there is a good and bad and ugly. The problem is there's not so much on the good ledger.
Clearly, it can relax us. And as we've talked before, and we'll probably talk again in the future, from a health standpoint, social interactions actually are highly predictive of whether we're going to live long or not. Having people in our lives that we can share the ups and downs with isn't just enjoyable, it actually affects our cardiovascular system and our likelihood of living longer. So, if alcohol lubricates some social interaction, that's probably a good thing. Again, alcohol has its problems, but that is one of the goods.
Now, for a lot of years, there was this sense of the Mediterranean diet, and those people drink red wine and they're drinking it at lunch and they're drinking it at dinner. So, alcohol must be good for you. The more people have dug into that, the relationship is not so clear. Some people felt it was red wine, there was Veritrol, which is an element of red wine, but you have to drink so darn much to get the benefit of that, that it is probably not what's going on. I think it turns out that there isn't a strong argument to say this is good for me to have a drink every night.
Roger: Okay, so that's it. What else is good about it?
Dr. Bobby Dubois: That's it for the good. There's not a lot on the good side, sadly. That doesn't mean you don't do it. I mean, I ride bicycles and that's probably not a very safe activity, but I do the risk benefit calculus and I ride indoors a lot, but I do ride outdoors sometimes, and I accept that this has a downside.
Roger: Okay, and the bad?
Dr. Bobby Dubois: Well, there's the bad and then there's the ugly. So, of course, the ugly is really bad. So, we'll start with just the bad.
Roger: Yeah, don't go right into the deep end here.
Dr. Bobby Dubois: Yeah, so when I was early in my career as a physician, I took care of big-time alcoholics. Fifth or two fifths of vodka a day, and every part of their body falls apart.
They get liver disease, cirrhosis, liver cancer, heart problems, they have GI bleeding, just a mess of things. That was my understanding of what alcohol does, meaning massive quantities are not good for you. But if it's not massive quantities, maybe it's fine.
Well, there are a number of things that aren't good that do affect lots of people.
One is weight gain. So, alcohol has calories. If you have one or two drinks, you're probably talking about a couple hundred calories. So, it's not horrible, horrible, but if it's a couple hundred calories, added on to your regular intake over the course of a few months, you're going to gain a few pounds. That goes on and on and on.
Probably the bigger problem with alcohol and weight gain is it dulls your restraint. Yes. You might be able to say, you know, I'm not going to have dessert tonight because I had the appetizer and I don't want the desserts, more calories. But if you've had a couple of glasses of wine, it's a little harder to stay away from that extra serving of whatever or finish everything on your plate. So that's probably the bigger weight issue.
Roger: It's a cascade. It's a cascade.
Dr. Bobby Dubois: Yeah, it is. It is. The next thing on the bad scale, which borders on the ugly scale, is that alcohol increases the risk of cancer. Some of them are uncommon cancers, sort of mouth and throat and larynx, and that plus smoking is a real bad combo. But it also increases colon cancer, liver cancer, and even breast cancer. For some of these cancers, it's a 25% increase in risk, a 50% increase in risk, a 100% increase or a doubling of risk, and there's no lower bound where you're safe.
Roger: Well, I was going to ask that because I hear "this increases your risk of cancer" and I've seen studies related to other things and other studies not related to alcohol It's a matter of how much alcohol in this case increases the risk to cancer Is there a bound on that or is it?
Dr. Bobby Dubois: There appears not to be a lower bound, any amount of alcohol will increase your risk.
Obviously, more alcohol will increase a greater risk, but there's kind of no lower bound. Now, this is a risk I'm willing to accept and drink small amounts, but others, because again, I started this by saying 40% of people don't drink alcohol at all. President Trump has often talked about the fact he's never had alcohol, so there are definitely people who it's not a part of their life and never will be. For me, it's not going to be the case, but I accept that there may be a small increase.
Roger: Just like if you ride a bicycle, there's a risk you except for that pleasure.
Dr. Bobby Dubois: Exactly. Right. Exactly. On the bad side, there's a risk of falling and we all worry about falls and that's part of the dialogue we've had about exercise and strength and balance. But when you drink alcohol, it does make that balance issue worse, especially if you drink more than two drinks at a time. If you're young and you have a bunch of drinks and you fall down, you're probably okay. But as you get older, any fall can be problematic and potentially even catastrophic if you break a hip. So that's another thing that we need to keep in mind.
Then there's sleep. Sleep and alcohol do not go together. Now you may think again, as we talked in the sleep module, that you're falling asleep quickly, but the quality of the sleep and the length of sleep is going to be interrupted and there's lots and lots of data on this.
If you have one drink or so, it's going to impair it by around nine percent. If you have a couple of drinks, the quality of sleep may deteriorate by 24 percent. If you have more than two drinks, you may have a 40 percent reduction in sleep quality. Whether you're wearing a whoop band or an aura ring, or you just realize you wake up in the middle of the night and you have a hard time going back to sleep.
This is a problem and for some people, obviously, it's greater than others.
Roger: I've been experimenting with myself all year on this because I do wear a whoop band. Sleep is a priority that I set at the beginning of the year, an intention that I have just done miserable with. It's actually gotten worse. I have to refresh it, and I think alcohol is related to that. And I definitely can tell from the data on the whoop, even as inaccurate as that is, that it impacts it.
I think it's important when we talk about this, oh, it hurts my sleep, but we have to remember things that you've shared. In prior episodes regarding this, how important sleep is in terms of Alzheimer's, etc. So, this all sort of works together, and I think that's something we need to always remember, right?
Dr. Bobby Dubois: Yeah, and you know, if you are going to drink alcohol, to the extent you can do it as early in the day as possible, I'm not saying at 7 in the morning, but maybe at 5 o'clock, and then you go to bed at 10 o'clock at night, finish your alcohol at 5, 530, and it should have a much lesser effect on your sleep.
Roger: Okay, let's get ugly.
Dr. Bobby Dubois: Ugly. Everybody knows that DUIs are often related to alcohol. There are 10, 000 deaths a year due to DUIs, so obviously that's pretty ugly, and it isn't just people that are frank alcoholics. Anybody that drinks a few drinks at the restaurant and drives home is at increased risk.
Where Gail and I had the wake-up call when we listened to Andrew Huberman's podcast was a series of studies they've done on the brain.
Now, I always assume that if you're a, what I would call a social drinker, and you drink 7 to 14 drinks a week, which is 1 to 2 drinks a day, or You drink a few days and during the week, and maybe you have a cocktail and a glass or two of wine at dinner on Friday and Saturday night, you're already in the 7 to 14 categories. It's not hard to get there, especially as you said, if you're honest about how large a drink you pour yourself, because it is very easy to pour a larger glass of wine or put a little more spirit in your Manhattan or your Gibson or whatever it is.
So, what they found was they did a series of brain scans and they looked at cortical thickness, which is sort of the outer portion of the brain where all the important stuff happens, like memory and like reasoning and all the important stuff that even people that were drinking 7 to 14 drinks a week had cortical thinning. So, it appeared that the people that drank less than seven a week did not have that cortical thinning. And obviously if you go beyond the 14 drinks, it's going to be even worse. But there was significant thinning in what I would call the social drinker group. And that was the group we were in, and that's the group we decided to leave. So now we're strongly in the less than seven per week category.
Roger: First off, I don't even know what a cortical is, and you've mentioned it, but maybe we need to refresh that. Second, why do I care? What is cortical, I.E., the cortex, and why do I care about it?
Dr. Bobby Dubois: Okay, so your brain has many different parts to it. We've talked about the amygdala in the past, that is where a lot of our emotions and memories and stuff, and the hippocampus, where that stuff is stored. That's sort of inside the brain. The outer cap of the brain, the cortex, has a bunch of brain cells. That's called your gray matter, and then the white matter are all the little axons, the little connections, lower down. Basically, the Cortex is where you think, and it's where you reason, and it's where you see, and it's where you smell and hear, and all these other kinds of things.
So that's something that thins in Alzheimer's disease, and we don't want that to happen, because that's going to take its impact on our mental abilities. So, this is just another thing that seems to accelerate the loss of those cells. I mean, to be blunt, how do you sterilize or kill things? You stick them in alcohol.
So it's not a surprise that drinking alcohol pickles things and kills things. So, it's again, not a surprise that it would affect your brain in a variety of ways, and we don't want that to happen. So that was our wake-up call.
Roger: Did the studies that were cited have a sense of severity? So, okay, it thins the cortical brain, the cortical brain, yeah? But to what severity? Is it like, it just contributes to the thinning? Or it, man, it really hyper drives it.
Dr. Bobby Dubois: Well, age causes problems and a variety of other things. So, what they, and I don't have the study right in front of me, but presumably what they did is they took a whole host of risk factors into account like age and everything else and then ask the question, okay, so now do you drink or do you not drink, holding everything else constant when people that are 65 and exercise this amount and smoke or don't smoke.
Okay. Okay. Okay. That's a given. Now, does alcohol affect the cortical thickness, and so that's how this was done. Now, it wasn't a randomized trial. You're not randomizing people to amounts of alcohol. I don't believe in most of these studies, they did cognitive testing at the same time. So, I think these studies were specifically scan based, but it was enough for us to say time to rethink this.
Roger: A concept that was reintroduced to me when I was reading Peter Attia's book, Outlive, which I think I sent you a text of something now is that we're at where we're at today and we have this cone of possibility to help influence what trajectory I take from here going forward. I guess that was the assessment you and your wife made, right? Is, hey, we can do this and that in the plus section of a better trajectory going forward for us.
Dr. Bobby Dubois: Exactly. Mother nature is going to take its toll, but there are some things that we can do to slow it and some things not to do, which will make it better.
The last of the ugly things is, and this is something I didn't quite understand. I thought that when you drink, it affects you emotionally, but it does for the period of time you're drinking, or if you had a hangover, maybe the next day or so you're not feeling so good, but long-term studies have shown that alcohol, and I'm not talking about binge drinking.
I'm just talking about general alcohol use will affect our emotions for months. Now it does. go away after a few months, but it actually affects us in ways that might be inhibitions or anger issues or sadness issues. It has a long-term effect. If you keep drinking socially, then it's going to keep having its long-term effect.
So that's just another thing that we're beginning to learn about.
Roger: All this is very interesting. And it definitely brings a mirror up for self-examination, which is nice, but one of the premises of the show is we want people to actually do things and have agency. So how should we respond to all this information?
What's a pathway that we can take?
Dr. Bobby Dubois: Well, it's the same way that we end every segment, which I love, which is let's just figure it out for you. I can't tell you how you're going to react or not react. So, basically, what I'm hoping is that our dialogue has raised an awareness that some people may want to say, huh, let me see what effect it's having on me, and I'll make some changes.
So, step one is awareness. Second is, figure out where you are on that drink spectrum and do it in the privacy of your own mind, or if it's hard for you to think backwards, do it forward and really measure out what you're drinking. So, you know, where you're starting, then choose something as a measurable, it might be weight, it might be sleep or sleep quality or sleep duration. It might be a mood scale; whatever you think you might want to understand what alcohol an impact on you has can do a bunch of these things. You can measure your weight, you measure your sleep, measure your mood, and then make a change. Presumably that change is not drinking more. Presumably it's cutting back in some fashion.
Maybe I'm not going to ever drink more than two drinks at a setting. Maybe I'm going to drink only twice a week and one to two drinks at a time. Whatever it is, you decide that you want to do and then give it a month or so and then come back and measure those things and then you will have your relationship with alcohol.
Now, proper caveat here. This is really more about your energy and your wellbeing that you can easily measure. What we aren't going to be able to measure is your risk of cancer at all, and we're not going to be able to measure any other kind of long-term issues like cortical thinning. So that you kind of have to take on faith that the science is pretty good, I will get that benefit if I cut back, but in terms of the more immediacy and the motivation to really make changes, there are some things about your day-to-day life that you can measure and go from there.
Roger: Yeah, I think when it comes to those long-term impacts on cortical thinning or Alzheimer's and all those other things, the way I envision it, Bobby, I have a grain of sand and that's my next action, let's say related to alcohol, and we have a scale in front of us. One is increased risk or not increased risk per se. I have a choice whether to put that grain of sand on increased risk, say cancer, or to put it on the other end of the scale.
That's the extent of our agency. Action by action by action. Right.
Dr. Bobby Dubois: I think that's right, and I think the heroic app, which we both use, you can set your goals. I know on certain days, I say no alcohol and having that kind of commitment in mind during the day makes it so much easier. If I'm going out to dinner and I would naturally order a glass of wine. I know from the get-go, I'm not going to, makes it a lot easier rather than just sort of sliding through the day and seeing how you feel, whether you're going to have a drink or not.
So that's helpful for me.
Roger: This is something I have got to work on personally. I got to do some experimenting here. I have to reevaluate my relationship with alcohol, one, because I care about my energy because I have so much, I want to do personally and professionally. But also, I think Bobby, for me, as I think about it, I got to start being a little bit more honest with myself in what I'm doing, because it's so easy to tell myself stories of I'm having two glasses when really, it's three and a half or whatever, and I appreciate that. Thank you for sharing. This is a great one to do an experiment. This is probably one of my favorites. Definitely.
Dr. Bobby Dubois: Wonderful.
Roger: All right. With that, let's go set a smart sprint.
TODAY’S SMART SPRINT SEGMENT
On your marks, get set,
And we're off to take a little baby step we can take in the next seven days to not just rock retirement, but rock life, life.
All right, in the next seven days, here's what I want you to do. If you partake in alcoholic beverages, just do an experiment this week. Take a night off. See how you feel in the morning. Start to connect some dots. This is all about awareness. And if you don't drink alcohol, pick something else, maybe it's eating later at night. Maybe you take a day or two and you stop eating by 6 and see how that impacts your sleep and how you feel the next day. The key here is, in an organized way, pull a lever, see the impact.
That's essentially the process we use to improve and rock life.
CONCLUSION
We love hanging out with you on this show, and this show is always going to be about you and empowering you to action. We do our best to minimize any conflicts of interest. We don't talk about products for money. We're not going to have advertising. We try to think with critical eyes, always focused on, well, actually with fresh eyes too, always focused on building frameworks that you can use to improve your journey to rock retirement.
I feel honored to be able to walk this journey with you, hopefully it's improved your life. I know that it's changed my life over the last nine and a half years, and I appreciate that. I hope you have a wonderful day.
The opinions voiced in this podcast are for general information only, and not intended to provide specific advice or recommendations for any individual. All references are historical and do not guarantee future results. All indices are unmanaged and could not be invested in directly. Make sure you consult your legal tax or financial advisor before making any decisions.