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Retirement Income
Most Retirees Withdraw Money the Wrong Way — A Smarter Strategy to Protect Your Wealth
The right withdrawal order could help your savings last longer.
It is possible to save throughout your life and make the correct investment decisions and yet end up losing substantial amounts of money because of unnecessary taxation.
The problem? Wrong withdrawal order.
Many people care about how much money they have saved for their retirement, but very few know that how they take out that money is equally important.
Your 401(k) account, Roth IRA, and brokerage accounts are all taxed in different ways. If you understand how each of these works, you will not have to unnecessarily lose money.
So, what is the best strategy when taking out your retirement money without having to pay more taxes? Let’s get into it.
1: Three investment categories
However, if you break down each account into its basic components, you will find out that all these accounts fall into one of these three categories based on their tax treatment.
Bucket 1: taxable accounts. These include your normal brokerage accounts.
