Retirement plan? Unsure of the tax consequences
of withdrawing from your investment accounts?
With a well-managed retirement plan, your money can work so you don’t have to.
You’ve been working for a long time, and now you’re thinking about spending more time embracing life. Enjoy the peace of mind that financial independence brings.
At Towerpoint Wealth, we believe:
- A disciplined, clearly defined, and properly coordinated wealth plan is vital for financial success.
- Reducing the two necessary evils to growing and protecting one’s net worth (taxes and expenses) drastically increases the probability of success.
- Financial and wealth management planning should simplify, not complicate, our clients’ lives.
- The best client is an educated and knowledgeable client. We are committed to making sure you understand how each decision impacts your overall strategy and ability to maintain your financial independence.
Are you aware of these retirement income facts?
- Withdrawals from qualified retirement accounts—401(k)s, 403(b)s, 457s, IRAs, SEPs, SIMPLEs, profit sharing plans (PSPs), defined benefit (DB) plans, etc., funded with pre-tax dollars, are fully taxable as ordinary income at the federal and state level.
- Withdrawals from Roth IRAs and Roth 401(k)s are tax free, as are loans from life insurance policies and interest income from most municipal bonds.
- Interest, dividends, and capital gains that occur in non-retirement accounts are reported to you annually on a 1099 form. You will pay tax on most, but not all, of this type of investment income as it occurs. A taxable account could be taxed at: a) ordinary interest income rates, b) qualifying dividend income rates, c) non-qualifying dividend income rates, d) long-term capital gains rates, e) short-term capital gains rates, f) ordinary income rates, or g) not at all if you simply have a return of principal.
Do you have a question about cash flow in retirement?
“At Towerpoint Wealth we strive to help each of our clients achieve, and then maintain, their financial independence.”
– Joseph F. Eschleman, CIMA®
President, Towerpoint Wealth
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