Retirement (Page 4 of 4)
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Originally Posted By TAP: This is the way. You normally want BOTH tax-free and taxable income during your retirement, or else you're leaving money on the table in terms of the standard deduction. Right now, your first $16k or so for a single is tax free- so take the tax break on the front end and then take that income tax free later. You need to do the math to see how it all shakes up, especially if you get a pension or social security later. Keep in mind this is all based on future (and thus unknown) tax rates, income brackets, and standard deductions. If you think tax rates will likely increase, plan accordingly. Means testing and all the other things that might come mean you can only plan and hope- we really aren't in full control of our own fates in most of this. In my case, most of my retirement income will be pensions. So, the more Roth money I have, the better…..for my particular situation. |
"It behooves every man to remember that the work of the critic is of altogether secondary importance, and that, in the end, progress is accomplished by the man who does things."
Theodore Roosevelt
Theodore Roosevelt
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Originally Posted By TAP: This is the way. You normally want BOTH tax-free and taxable income during your retirement, or else you're leaving money on the table in terms of the standard deduction. Right now, your first $16k or so for a single is tax free- so take the tax break on the front end and then take that income tax free later. You need to do the math to see how it all shakes up, especially if you get a pension or social security later. Keep in mind this is all based on future (and thus unknown) tax rates, income brackets, and standard deductions. If you think tax rates will likely increase, plan accordingly. Means testing and all the other things that might come mean you can only plan and hope- we really aren't in full control of our own fates in most of this. |
Then conquer we must, when our cause it is just,
And this be our motto: 'In God is our trust.'
And the star-spangled banner in triumph shall wave
O'er the land of the free and the home of the brave!
And this be our motto: 'In God is our trust.'
And the star-spangled banner in triumph shall wave
O'er the land of the free and the home of the brave!
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Originally Posted By ColtRifle: I am not familiar with TSP rules but generally, you can do Roth conversions. It’s not always advantageous to do so as it depends on your particular situation. But if you can do enough Roth conversions, you might be able to eliminate (definitely reduce) your RMD issues. It's going to depend on the nature of the TSP deposit When I rolled my various accounts up into one firm last year the one issue I encountered was the portion of my TSP account that had been deposited while I was in Afghanistan due to the tax-exempt nature of my income while there IIRC they ended up dumping that amount into a Roth, but it took my local advisor calling up her company to get advice on how to handle it. I guess she doesn't have a lot of GWOT military vets as clients |
*post contains personal opinion only and should not be considered information released in an official capacity*
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We got wiped by two bouts with cancer, mine and my wife. I have a small state pension that is adjusted annually. I am vested and I can return to government service and will contribute nothing as I have more than ten years of service credit. I’ll get about $1,400 a month in today’s dollars adjusted (somewhat) for inflation. For all of New York’s issues, its pension fund is fairly well funded and managed well. My wife and I both max our IRA contributions, and I max my SEP as well. That is considerably more than the 7-8% most people with a 401K put aside by your stats. Last year that would be around $30-$35k. We are in our mid-50s and I fortunately work with my brain and not my body, so if I keep my wits I should be able to keep this up for another 15 years, and honestly I have no desire to retire. At some point I will likely liquidate a large portion of my firearms collection, I just don’t have much interests in them any longer. I’ll always keep an adequate collection, but having what I have and not enjoying them seems silly. We’ll be OK because we choose to live simply. We could buy a house, but it is not the right move now as I don’t want to be tied to this shit state. Mom is 83, and in relatively good health for her age, but so long as she is alive I’m going nowhere. Our apartment is basic, affordable, and the management company does a solid job. We have no maintenance expenses and aren’t tied to a housing market. When it is time to go, we pack up and leave. I’ve toyed with the idea of buying a small retirement home in the south and immediately taking out a reverse mortgage. We don’t have kids, and the ability to live there until we die is appealing. The bank will own it, so I have to imagine that protects it from Medicare if we have to end up in a nursing home. I need to research this more. We each carry an insurance policy should one of us die before the other, and we have a lovely piece of property in the Vermont mountains that is cleared, ready to build, and has a well we drilled and an approved septic plan. We know we could unload that for a decent amount to one of the countless NYC/CT/NJ folks that want a weekend place in the mountains and have a very different concept of money. We likely won’t sell that until we’re ready to make a move elsewhere so we can roll the profits into another piece of property to avoid/mitigate capital gains. Cancer really fucked things up, but it didn’t break us and we have reasonable expectations for retirement. But yes, it does weigh on me at times. |
The duty of a patriot is to protect his nation from its government.
"I would remind you that extremism in the defense of liberty is no vice! And let me remind you also that moderation in the pursuit of justice is no virtue!"
"I would remind you that extremism in the defense of liberty is no vice! And let me remind you also that moderation in the pursuit of justice is no virtue!"