Tag: Investment Advisor Oregon

After years of building your retirement accounts, it’s time to enjoy your hard work. But don’t forget that the IRS requires you to take required minimum distributions (RMDs) from some of those accounts.

As you build your nest egg, you will run into challenges. Markets go up and down. Big, unexpected expenses come into the picture. It’s normal for feelings of instability to accompany those challenges, but you can build resilience into your financial planning that can help you stay on track for your long-term goals.

After years of building your retirement accounts, it’s time to enjoy your hard work. But don’t forget that the IRS requires you to take required minimum distributions (RMDs) from some of those accounts.

Understanding the nuances of your retirement accounts today can make a massive difference in your wealth decades from now.

The choice between pretax and after-tax accounts is essentially a decision about when you want to pay the IRS. By choosing the right “tax bucket” for your current income level and future expectations, you can potentially keep a much larger slice of your hard-earned nest egg. Here is a quick breakdown of how these two heavy hitters compare.

Depending on your birth year, the IRS requires you to start withdrawing from your retirement accounts once you are 73 or 75— whether you need the money or not. Those withdrawals, called required minimum distributions (RMDs), count as taxable income. And depending on how much you’re required to take, they can affect your tax bracket, your Social Security taxes, and even your Medicare premiums.

Selling investments for a profit is good news for your portfolio, but it often comes with an unwelcome side effect: a bigger tax bill. Capital gains can add up fast, and many investors don’t realize there’s a strategy that can help offset them.