Bogleheads® Live
Mike Piper on Social Security
Jul 4, 2022
Mike Piper, a CPA and author specializing in Social Security planning, dives into the intricacies of Social Security benefits and retirement strategies. He addresses key questions from the audience, shedding light on tax strategies for early retirees like Roth conversions. Piper explains actuarial equivalents and their implications for singles versus married couples in terms of claiming benefits. He also discusses the optimization of filing strategies and the importance of clear communication in estate planning, providing practical tips for effective financial planning.
33:12
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Quick takeaways
- Delaying Social Security benefits can significantly increase lifetime income, especially for higher earners due to survivor benefits implications.
- Utilizing strategies like Roth conversions during lower income periods helps maximize tax efficiency and prepares for tax-free withdrawals in retirement.
Deep dives
Tax Strategies for Early Retirement
When retiring early, individuals often encounter a unique financial situation where income is temporarily lower before starting Social Security and required minimum distributions (RMDs). In this context, strategies such as Roth conversions and tax gain harvesting come into play. Roth conversions might be preferable as they allow users to utilize their lower tax bracket to pay taxes on converted amounts now, ensuring tax-free withdrawals later. In many scenarios, failing to sell appreciated taxable assets could result in those gains being tax-free for heirs or when donated, making Roth conversions the more beneficial approach.
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