Performing Roth conversions in your lower-income years, allows you to potentially decrease your total tax liability throughout your retirement.
A successful retirement investment strategy does not require great genius nor tremendous effort, but it does require you to stick with that strategy in good times and bad.
Qualified charitable distributions can be a tax-efficient way to manage required minimum distributions for those who are charitably minded. Because of their tax benefit, QCDs and RMDs should be carefully coordinated to ensure proper timing. It is reasonable to seek out assistance from a trusted advisor to assist you with their execution.
Healthcare costs are an important factor to consider when creating your retirement income plan. You want to ensure that these expenses are properly accounted for. However, these costs can potentially be affected by your income in retirement.
Some higher-income retirees may have to pay more for their Medicare Part B and Medicare Part D prescription drug coverage. This is due to something called the Income-Related Monthly Adjustment Amount (IRMAA).
Once you understand how your Social Security benefits are taxed, you can begin exploring opportunities to potentially reduce the taxes you pay. Depending on your income and mix of assets, you may have the ability to better manage your tax liability in retirement.
As with most things in retirement income planning, there is no universal best approach for taking withdrawals. Your specific circumstances should determine which approach you take and should be reassessed if/when your plans change. Having assets in all three types of accounts can prove to be a useful tool in retirement.
The WRAP process can be useful when making decisions when planning for retirement. While you can still have bad outcomes, the focus is placed on the analysis rather than the results.
Developing and adhering to a sound investment strategy is essential in retirement. This strategy will likely look different than the one you used during your accumulation years. You must find a balance between today’s spending needs and those of the future if you plan on maintaining your standard of living throughout retirement.
Inflation is yet another risk you may face in retirement, though its effects may not be felt for many years. With smart planning and prudent investing, there are ways to attempt to mitigate its effects on your purchasing power.
Retirees today have access to more free information and resources than ever before. The issue now is not access but rather the accuracy of the information and mistakes can be costly. Understanding the information and actually implementing the recommendations from that information are two different skills.