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  1. #31
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    I guess it is easier in some ways to be working class. I have never worried about deferring income to avoid taxes.

  2. #32
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    Quote Originally Posted by Yppej View Post
    I guess it is easier in some ways to be working class. I have never worried about deferring income to avoid taxes.
    Not one of my problems either. And pretty much the only "stocks" I have are on my pantry shelves.
    To the world you may be one person, but to one person you may be the world. - Anon.

    Be nice whenever possible. It's always possible. - Dalai Lama

  3. #33
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    Quote Originally Posted by SteveinMN View Post
    Thanks, IL; that's sound advice.

    One of the biggest challenges we've found in dealing with financial planners is finding people who know enough to be able to advise on that entire concept of taxation of income. Sure, they know the broad stuff like Roth versus traditional IRAs, but working HSA income and SS and pensions and non-retirement savings and all? I realize there are a few variables missing from those equations (how long the money will be needed, inflation, etc.), but most planners we've talked with don't/can't get to the level of explaining something as simple as what you mentioned (about ACA income categories). I suppose that will be something I have to learn myself.
    I would be interested in knowing how to do this too.

  4. #34
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    Quote Originally Posted by Yppej View Post
    I guess it is easier in some ways to be working class. I have never worried about deferring income to avoid taxes.
    That is not necessarily the situation. After being frugal for years, how does a person start spending in a realistic manner? As an example, it would be stupid to cash in an IRA before eligible to do so. I am sure it is wise to cash in certain equities before others. It is not avoidance of taxes but being prudent.

  5. #35
    Senior Member SteveinMN's Avatar
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    Quote Originally Posted by frugal-one View Post
    That is not necessarily the situation. After being frugal for years, how does a person start spending in a realistic manner? As an example, it would be stupid to cash in an IRA before eligible to do so. I am sure it is wise to cash in certain equities before others. It is not avoidance of taxes but being prudent.
    I've heard people say -- and we're starting to experience -- that, in retirement, your thinking about money changes from your working days. You're (typically) no longer on a career track, so just moving to another company for a raise isn't happening.

    And the money itself is a little different. Pulling money out of a Roth IRA is tax-free (since you paid it before the money went into the Roth). But does it make sense to tap a Roth now or start emptying a regular IRA or even just non-retirement savings/investments now -- or do you expect to be paying a different tax rate either because of income levels or because tax laws changed? How do you make sure you don't bring in so much money between minimum distributions and any jobs you have that you mess up eligibility for ACA (what IL has been watching)? In DW's case, that HSA technically can be used to pay for non-medical expenses; does it make sense to change the investment allocation on that if we'll want/need that money for HI premiums? Lots of questions.

    How to learn that? Lots of reading. Some periodicals like Barron's, Web sites like marketwatch.com, Mr. Money Mustache, bogleheads.com (my favorite), some retirement forums. Thing is that someone's experience in another state may not be something you can match in your own state. But it can raise the questions you can research yourself or ask your accountant/lawyer/financial advisor.
    Success is to be measured not so much by the position that one has reached in life as by the obstacles which he has overcome. - Booker T. Washington

  6. #36
    Senior Member Teacher Terry's Avatar
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    When we retired our money in deferred compensation was not taxed so it’s taxed when taken out and you have to be smart about it.

  7. #37
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    It is my opinion that it was easier to save the money into tax deferred accounts than it is to figure out the best way for us to spend it in retirement. We did balance our savings into both deferred and nondeferred investments so we have some time to think about it.

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