Take Steps Today to Manage Your Estate Tomorrow

In this ebook, you'll learn the critical elements of an estate strategy. Considering these crucial details may help an executor uphold your values, goals, and desires for your estate.



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7 Ways to Reduce Taxes Before You Retire

7 Ways to Reduce Taxes Before You Retire

January 08, 2024

You may be able to reduce your taxes and increase your income before you retire if you follow these strategies:

  1. Maximize retirement contributions to tax advantaged accounts like 401ks, IRAs and Roth IRAs. Be sure you take advantage of catch up contributions if you are 50 years old or over in the current tax year.
  2. Diversify your retirement savings among taxable, tax deferred and tax exempt accounts. It is much easier to manage your tax liability and marginal tax rates in any one year if you can draw from different sources. 
  3. Consider Roth conversions. Marginal tax rates are likely to increase in 2026 with the sunset of the Tax Cut and Jobs Act of 2017. You may be better off paying some taxes now rather than later. 
  4. Review asset location. You may be better off placing a portion of your stock portfolio in taxable accounts to take advantage of long term capital gains rates and moving your bond allocation to your IRA or Roth account to avoid taxes on interest income.
  5. Explore charitable giving strategies like Donor Advised Funds that provide immediate tax benefits up to a specified amount while allowing for strategic giving over time. 
  6. Develop a tax efficient estate plan. Various trusts can alleviate your estate tax burden while achieving your goals. Take into consideration the step up in basis on inherited assets. 
  7. Stay informed. Tax laws can change and significantly impact your estate. 

Everyone's financial situation is unique so it is important that you consult with a qualified tax professional or financial advisor before implementing any specific strategy. Personalized advice can make a significant difference in the taxes you pay in retirement.