IRAs and 401(k)s Are Nice Now, But Will RMDs Hamper Your Retirement?
Most people are conditioned throughout their working lives to save as much as possible for retirement and to be prudent investors.
Unfortunately, most people mindlessly put money in tax-deferred retirement accounts, such as traditional IRAs or their employer-sponsored 401(k)s. That approach helps them save on taxes during their working life, and it’s an effective way to build savings. But it’s not in their best interests, as they reach their 50s and 60s, to keep contributing money willy-nilly to their IRAs and 401(k)s.
Why? Because of the tax ramifications. It’s critical that, well ahead of retirement, people take a look at strategies that will reduce their tax burden in retirement. Because it’s not about all the money you make in your working lifetime, but about how much you get to keep.
