Ichee-marone - a few thoughts as I agree with you....My two cents on that thread. Who has 2-3 years expenses in cash or can generate this amount of money through capital gain harvesting? A very small percentage of people, I reckon. I don't doubt there are some people with such amounts in non-qualified accounts. Great for them if they want to go to that much cash to avoid taxes! We are all faced with a lot of moving parts in retirement cash flow. 2-3 years of expenses in cash, could be achieved by CD/bond laddering which generates 1099-INT. The opportunity cost of saving this amount of money prior to retirement is high.The correct answer is none of the above if you care about how much taxes that you pay during retirement.In general is it better to withdraw contributions from a 401K, and save the Roth IRA for later in retirement, or the other way around?
The amount that you spend each year may not have any relationship with the taxable income you generate each year.
A) If you have 2 to 3 years of expense in cash, why do you need to withdraw anything to spend?
B) For example, if you only spend 10K per year but you can Roth convert 20K and Capital gain Harvest 60K at 0% tax, why won't you do it?
C) Check out this thread.
viewtopic.php?t=87471
"How to pay ZERO taxes in retirement with 6-figure expenses"
KlangFool
- having a bunch if cash is just generating more of a tax problem at 5% or so.
- a short term view/plan for taxes in retirement is almost awlays short sighted
"The amount that you spend each year may not have any relationship with the taxable income you generate each year."
- you owe and pay taxes on income, not onexpenses. At some point the tax deferred account needs to be dealt with if you choose to ignore it early on.
Statistics: Posted by smitcat — Wed Feb 21, 2024 1:06 pm — Replies 20 — Views 815
