Be Smart with Your 401k and Defined Contribution Plans
When you begin to withdraw money from 401ks, traditional IRAs, and pensions after you turn 59.5, you avoid the early penalty but you will still be taxed.
Be Smart with Your 401k and Defined Contribution Plans
When you begin to withdraw money from 401ks, traditional IRAs, and pensions after you turn 59.5, you avoid the early penalty but you will still be taxed. However, once you also start collecting Social Security, your income will increase even more.
Retirees think they should not touch their retirement plans until age 72 and live on the dollars invested in the brokerage accounts. This can be a big mistake.
One smart tax strategy for high net worth investors is therefore to take larger withdrawals from your 401k and other plans before you turn 72, and thus reduce your RMDs when they arrive.