Don't Let Taxes Torpedo Your Retirement

You are enjoying retirement, cruising along when all of a sudden you get RMD Tax Torpedo shot at you.  That’s right, many do it yourself retirement planners are learning the hard way that taxes are still an issue in retirement.  Let’s say for example, you and your wife have a taxable income of $170,000 a year.  You have planned on what your taxes are right???  Then her comes Uncle Sugar’s shot across your bow when you hit 70 ½, the Required Minimum Distribution (RMD).  All of sudden you are required to take a certain amount out of your 401(k)/IRA savings and now not only does your taxable income go up but so does your monthly Medicare premium.  Say what??  If you and your spouse go over by just $1 above the $170,000 yearly taxable income, your monthly Medicare premium goes from $134 a month to $187.50 per month.  That is a 39% increase in your health insurance, not to mention the possible increase in your income taxes.  This is just one example of how poor tax planning can impair your retirement.

The good news is that you can make a plan that works better than re-arranging the deck chairs on the Titanic.  You can strategize which accounts to take income first, possibly delaying taking your social security and gently sail past the iceberg.  Call us today; we would love to help you enjoy your retirement without having to man the life boat.

Mike

Mike Mickels is President of CochranMickels Retirement Specialists and an avid sporting clay competitor. CochranMickels Retirement Specialists provides personalized planning and investment services to individuals approaching and in retirement. They also provide retirement and benefits training to Federal employees. Securities offered through Registered Representatives of Cambridge Investment Research, Inc., a broker-dealer, member FINRA/SIPC. Advisory services offered through Cambridge Investment Research Advisors, Inc, a Registered Investment Advisor. CochranMickels and Cambridge are not affiliated. Mike Mickels is President of CochranMickels Retirement Specialists and an avid sporting clay competitor. CochranMickels Retirement Specialists provides personalized planning and investment services to individuals approaching and in retirement. They also provide retirement and benefits training to Federal employees. Securities offered through Registered Representatives of Cambridge Investment Research, Inc., a broker-dealer, member FINRA/SIPC. Advisory services offered through Cambridge Investment Research Advisors, Inc, a Registered Investment Advisor. CochranMickels and Cambridge are not affiliated.