Episode 5: How Retirement Income Is Taxed — What Most People Don't Know

Most people plan carefully for what they'll have in retirement — but not for what they'll keep. Taxes in retirement are more complicated than most people expect, and the mistakes are expensive.

In this episode, I walk through how your different income sources are taxed in retirement: Social Security, IRA withdrawals, Roth distributions, investment income, and required minimum distributions.

In this episode: ▸ How much of your Social Security benefit is actually taxable ▸ How traditional IRA and 401(k) withdrawals are taxed ▸ Why Roth distributions are different — and when they matter most ▸ Required minimum distributions and how they affect your tax bracket

Most pre-retirees are surprised by how much of their retirement income ends up being taxable. Social Security can be up to 85% taxable depending on your combined income, and traditional IRA withdrawals stack on top of that as ordinary income. Required minimum distributions starting at 73 can push your bracket higher than you planned for. Roth distributions are the exception — they're tax-free and don't affect how your Social Security is taxed, which is why building Roth assets before retirement is worth considering. This episode walks through each income source so you understand the tax picture before the decisions are made.

▶ Next: Episode 6 — Roth Conversions Before Retirement

▶ Watch Episode 4 → When Should You Start Social Security?

Ready to build your retirement income plan? Schedule a Retirement Plan Fit Call