A retirement age couple confident that they will pay low taxes in retirement after finalizing their Fort Worth Retirement Planning with their Dallas retirement financial advisor.

Tax Efficiency in Retirement While Maintaining Your Lifestyle

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When you sit down with your Dallas retirement financial advisor, make sure to always keep your  taxes in retirement in mind. This is because tax efficiency is a crucial component of your Fort Worth retirement planning and directly determines whether or not you will be able to maintain your lifestyle throughout your entire retirement. Thankfully, you and your Dallas retirement financial advisor have a few strategies you can employ to keep your tax bill as low as possible. Here are just a few of them to consider as brought to you by the expert advisors at Retire Guides.

Choose a Tax-Friendly State For Your Fort Worth Retirement Planning

In most Fort Worth retirement planning, savings held in 401(k) plans or IRAs make up a majority of the income source for retirees. As any Fort Worth financial advisor will tell you, the withdrawals you make from such accounts are considered income for tax purposes. Fortunately, not all states treat retirement income the same way. The following states don’t charge taxes on any income of any kind: Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming. In addition, four more states have made exceptions to not tax retirement income: Illinois, Iowa, Mississippi, and Pennsylvania. You and your Dallas retirement financial advisor should plan for moving to one of these states for your golden years.

Other Fort Worth Retirement Planning Tax Efficiency Strategies

There are other ways to minimize taxes in retirement. You can use capital losses on some investments to offset capital gains on others. Your Fort Worth financial advisor can explain to you how to bundle or defer income to a single tax year or take advantage of tax deductions and credits. Or your Dallas retirement financial advisor could recommend investments that pay little current income but have strong growth potential. These could include index funds, exchange-traded funds, managed accounts, real estate, individual securities, and mutual funds. Another strategy to adopt as part of your Fort Worth retirement planning is to make charitable gifts of assets that have increased in value. This method allows you to avoid capital gains taxes while taking a tax deduction for the current value of the asset.

Let Retire Guides Be Your Partner in Fort Worth Retirement Planning

The earlier you can team up with a professional Dallas retirement financial advisor, the better-informed your retirement decisions will be. Retire Guides specializes in helping people with their Fort Worth retirement planning by putting you together with a Fort Worth financial advisor who will take into account your financial realities, future plans, and retirement goals to create a unique personalized plan that ensures you get to make the most of your golden years. Call us today and get started on the path to your dream retirement!