The Three Buckets of Tax Diversification
Do you want to take income out in retirement from the Taxable, Tax-Deferred or Tax-Free Bucket?
“Why, Tax-Free, of course”, you say.
That’s interesting since most Americans have very little or nothing at all allocated to this bucket.
Many tax-deferred retirement plans such as IRA’s and 401K’s look like icebergs.
All you can see is the tip of it and what lies beneath can be a tax-infested monster.
If the top marginal tax rate jumps from 39.6% to 60% so does Uncle Sam’s portion of your retirement account.
But what if you could shift your assets from the Tax-Deferred to the Tax-advantaged Bucket? Taxes are due when you perform a Roth conversion but a major benefit includes no longer having to take out required minimum distributions.
For more about shifting from the Tax-Deferred to the Tax-advantaged Bucket, please give us a call at 949-474-8440.