How to Pay $0 Tax on $100k Retirement Income

➡ PLEASE READ! ⚠️ Be careful of scammers. In the COMMENTS section, We will NEVER offer any investment products, recommend a stock broker, or anything similar. Some scam bot commenters coordinate a “conversation,” including “asking” for investment help, and reply with "how great X idea/investment/person is" in the replies. These are scam threads. Do not fall for them."

This does not constitute an investment recommendation. Investing involves risk. Past performance is no guarantee of future results. Consult your financial advisor for what is appropriate for you.

0:00 - Introduction
0:42 - 100k as Regular Wages
3:22 - Retirement Tip
4:45 - Retirement Income Source #1
6:27 - Retirement Income Source #2
7:45 - Retirement Income Source #3
9:21 - Retirement Income Source #4
12:20 - Conclusion

[onedegreeadvisors]

WARNING There has been an increase in bots and spammers commenting on our videos. Sometimes the interactions may look real, but are easily identified by commenters promising high returns or promoting other 'advisors'. Please report these comments if you see them so we can keep our community safe from these scams. I will never try to contact you; you can only get in touch with me via the link in the description of the videos.

[tatianastarcic]

I converted my 401k to a Roth IRA to avoid higher taxes in the future. I'd rather pay taxes now than be stuck paying taxes on my retirement income when I'm 59 and living off my savings.

[tonygr]

So far I'm doing good, approaching retirement with about 850k in savings. Transitioning from building wealth to spending can be scary, especially with soaring inflation. My question is, after maxing out my tax-advantaged retirement accounts, what next?

[Deitricklaverne]

Between Social Security, withdrawals from retirement accounts, and potential capital gains, it feels like there are so many ways to get hit with a big tax bill

[EmmilyElizabethh-ni]

Most Americans find it hard to retire comfortably amid economy downtrend. Some have close to nothing going into retirement, my question is, will you pay off mortgage as a near-retiree, or spread money for cashflow, to afford lifestyle after retirement?

[Daniel-bss]

At 32, I'm diving into investing for the first time. I’ve started contributing to my 401K and opened a Roth IRA with automatic contributions. My main question is whether asset allocation is crucial at this stage or if I'm just overthinking as a beginner.

[iupab]

You’re a great Communicator ! Everything is explained in enough detail that most people would easily understand. Even when I’m thinking I need a little more explanation you somehow anticipate this and provide the additional needed detail.

[SHO]

I thought the tax system was complex while working. I had no idea the complexity increased exponentially after retiring. What the Hell?!? That explanation was mind numbing. And how much did Dave and Sandy have to pay their accountant to navigate through that mess? This country seriously needs to over haul the tax system and simplify it. This is nuts that this has so many levels of complexity.

[scottsnyder]

Nice video. It just goes to show that planning for withdrawals is as important as saving for retirement. If you do it wrong a lot can go to taxes.

[laxnative]

I found myself in a low (10%) marginal tax rate bracket in 2024. Which means my LTCG tax rate (up to a point) was 0%. So I sold some Apple stock I've held for years for a $15k gain. All taxed at 0%. Then I rebought all the stock a few days later. If/when I eventually need to sell it in the future (say in retirement), I'll have less taxable gain to report.

[irahartoch]

Interesting and technically correct. A couple of "buts"... If your couple is 73 (or older) they will be subject to the RMD on their IRA. When they are 73 the RMD on $1M would be $36, 500 (rounded). That would put them over $100k before they ever get to use the capital gain "trick". As they get older (than 73) and assuming they can maintain $1M in their IRA(s) the amount of the RMD will continue to rise. Second, to use the capital gain scenario they will be depleting their taxable investment account and it will be gone in just a few years to keep utilizing the strategy at which point they won't be able to maintain the $100K/year income level without withdrawing significantly more from their IRA.

[anthonylosego]

I've heard people say Roth IRA is the way to go, but I also know most people over estimate their expenses after retirement. My thought is that if you have a much lower tax bracket at retirement, it would make more sense to use a traditional IRA to get more gains from time in the market with more funds rather than taking Roth post tax over the years.

[brucewampler]

Good video - lots of useful information. However, I would add a couple of comments. The first one is one you have already mentioned. When the individuals are at or beyond the RMD age, they won't be able to avoid significant taxable IRA distributions. Yes, they might do Roth conversions before retirement, but it that case they are still paying the tax; in fact, they are paying it sooner than they would if they waited until they reach the RMD age. Second, I wouldn't refer to the $100, 000 as "income." It is actually "cash flow." As you mentioned, one-half of the amount withdrawn from the brokerage account is a return of capital, and such amounts are never taxable. For example, if the clients had significant amounts in savings accounts or CD's, these accounts could create cash flows without generating any current taxable income (any tax on amounts previously earned as interest would have been taxed in previous years). Thanks.

[thomasbunch]

Loved this video sir. I will retire with 2 pensions in addition to collecting SS. I have a 457 and Roths. I would love to see a tutorial on how I could minimize my taxes on the pensions as well.

[AllenMassey]

What is the tax planning software you are using?

[trekhardfilms]

Thanks for the great and inspiring video. I am confused on "provisional income". I see in our case for 2025 the rate is $44, 000. So is it $44k of OTHER income (outside of society security) that you look at to determine if it's 85% taxable? thanks!

[pbr]

Sir, can everyone access the same application (ONE) that you used in your video to conduct multiple "what if" scenarios on their own? I ask because I will be pulling a pension in retirement that throws the numbers off.

[Roga]

You mind sharing what software you are using?

[Laura-rxmp]

Hi, do you ever address federal retirees on pensions (not SS). Thank you

[stephanebogen]

Great video. Can we get access to the software you are using in this video? If not, can you recommend one to run similar scenarios? - many thanks