No, Taxes Won’t Derail Your FIRE: Here’s What You’ll Really Pay in Retirement
Podcast Description
Taxes in retirement have been called a “silent wealth killer” for those pursuing FIRE—but does the data tell a different story? If you’re worried about a ticking tax bomb wiping out a huge chunk of your investment portfolio or even delaying early retirement, you won’t want to miss this one!
Welcome back to the BiggerPockets Money podcast! Today, we’re joined by fellow investor and self-proclaimed data nerd Mark Livingstone, who has created a free resource and spreadsheet YOU can use to estimate your tax burden in retirement. For most early retirees, taxes are negligible compared to the amount of income they can withdraw, and Mark will demonstrate this with a step-by-step walkthrough of his powerful FIRE tax tool!
Along the way, you’ll learn the key differences between marginal and effective tax rates and why people who retire today pay much less tax than in decades prior. You’ll also hear about the four income “levers” you can pull in retirement, when income tax and capital gains tax kick in, and how to build the most tax-friendly withdrawal strategy possible!
In This Episode We Cover
Why taxes in retirement aren’t nearly as bad as you probably think
A step-by-step walkthrough of Mark’s free retirement tax spreadsheet
How the United States’ progressive income tax system works
Marginal and effective tax rates explained (and how they impact your tax burden)
The four income “levers” you can pull in retirement (and how each is taxed)
How taxes impact the safe withdrawal rate (and why the 4% rule works)
And So Much More!
Check out more resources from this show on BiggerPockets.com and https://www.biggerpockets.com/blog/money-642
Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email advertise@biggerpockets.com
Learn more about your ad choices. Visit megaphone.fm/adchoices
