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HSA: How to Beat Taxes Like the Rich

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The rich have a different focus. They're not worried about saving for retirement—they’re worried about passing their wealth to heirs without paying too much in taxes.  Taxes are their biggest enemy. And they've figured out how to avoid them. For the rest of us, we don’t have millions to protect. But there’s a powerful tool we can use to save on taxes. It’s called the Health Savings Account (HSA).  Here’s how it works. True Story  I recently went to the eye doctor. Here’s what I spent: Extra test: $39 Ray-Ban frames: $375 Total cost: $414 that I paid with my HSA card. Because the money in my HSA is pre-tax, I didn’t need to earn as much to cover the cost. Pre-Tax vs. Post-Tax Spending Let’s say you're in a 24% federal tax bracket, and you also pay 5% state tax. Your total tax rate would be 29%. Without an HSA (Post-Tax): To pay $39 for the eye test, you’d need $54.93 before taxes.  To pay $375 for the frames, you’d need $528.17 before taxes.  For the total ...
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How Taxes Could Be Sabotaging Your Retirement

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If you’re planning for retirement, you’re probably thinking about your investments. But here’s something you can't ignore: taxes. A solid tax strategy is just as important.; and if you don’t plan for it, taxes could eat into your savings.

Taxes Can Take More Than You Think

Taxes are coming for you, whether you like it or not. They’ll take a cut of your paycheck, and when you retire, they’ll take a cut of your savings. 

If you don’t plan for them, taxes on your 401(k) or IRA withdrawals could surprise you.  For instance, if you withdraw $50,000 in a single year from a traditional IRA, it could bump you into a higher tax bracket, increasing your tax rate from 12% to 22%. 

That’s a difference of $5,000—money that could have stayed in your pocket with better planning. 

A tax strategy helps you avoid this by spreading out your withdrawals and taking advantage of tax-free options like a Roth IRA, and Roth 401(k).

Taxes Don’t End When You Retire

You might think taxes are only a problem while you’re working, but that’s not true. For example, Social Security benefits can also be taxed if your income exceeds a certain threshold. 

Retiring without a plan could mean paying taxes on up to 85% of your Social Security benefits. But with a Roth IRA, the withdrawals are tax-free. So, having a mix of tax-deferred and tax-free accounts at the right time can save you a lot of money in taxes.

A Tax Strategy Gives You Control

Having a tax strategy puts you in control. You get to decide when and how to withdraw money. You could:

  •  Pull from a tax-deferred account when your income is low.
  • Focus on tax free accounts when taxes are higher.

Without a strategy, you could pull money out at the wrong time and end up paying more than you planned.

It’s Not Just About Investments

When you think about retirement, you probably focus on your investments. But taxes play a big part too. 

Someone with a $1 million portfolio in a traditional IRA might only get to spend $700,000 after taxes, depending on their tax bracket. That’s a huge difference.

Taxes are just part of the retirement puzzle. A good strategy ensures you don’t give more than you have to to the government.

How I Tweaked My Tax Strategy

I realized this firsthand after a recent conversation with a financial advisor. One year ago, I thought my retirement plan was set. But after reviewing my tax strategy, I made some small adjustments that made a big difference.

Now, I’m set to keep more of my hard-earned money in my pocket—and my retirement plan is on track to succeed even more than it was before. 

A slight tweak can have a huge impact, and it’s one of the best moves I’ve made for my future.

A Lot More Money Later 

Retirement planning isn’t just about choosing investments. So, while you’re focused on your investments, make sure you’re thinking about taxes too. 

A little planning now—like diversifying your accounts or timing withdrawals—can mean a lot more money later.




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