Thanks Johnathan for writing the article. I'll add one more item to the retiree's grocery tax list as food for thought for Roth conversions. If you're married and your spouse dies, there's a double whammy for the the surviving's spouses IRA withdrawals. First, there's the Increased taxes paid on future RMDs since the surviving spouse moves from the MFJ to single status. Secondly, depending on the age difference between the 2 spouses, may accelerate future RMD withdrawal% significantly. The difference between the Surviving Spouse vs Married RMD schedule is almost double once the surviving spouse exceeds 80yo.
John, it's too bad there's not a universal "future retirement financial planning course" that pre-retirement folks can take that touch on these topics. My self education has come through reading articles and comments from folks like you that contribute such learnings. A couple of other topical areas for consideration to add to the list that I have traversed over the 13yrs in retirement:
Higher Medicare IRMAA premium avoidance in income planning
Health insurance pre 65(Obamacare) and Income planning to assist with Healthcare subsidies and CSR(cost sharing reduction)
Widow(er) tax planning topic. What happens to RMDs when spouse dies. This plays to the Roth conversions before 73. I am watching this firsthand by handling my mom's finances and doing her taxes. Since my father died and it forced the move from the married to single RMD table, it certainly has had a dramatic impact on emptying out the IRA that she inherited. Couple that with the fact that she is also in a higher tax bracket since being forced out of the "married tax bracket" that exposes more of her income to higher taxes.
Social security claiming strategy. In many states, Soc Sec income is not taxed. Thus, by delaying your claiming you actually get a "two-fer" benefit. Higher monthly benefit and after tax income.
Comments
Kathy, my wife and I have discussed CCRCs and I know you live in the Raleigh area. I'm curious as to the CCRC that you chose and why. Thanks, Ray
Post: Look All Ways
Link to comment from November 22, 2023
Thanks Johnathan for writing the article. I'll add one more item to the retiree's grocery tax list as food for thought for Roth conversions. If you're married and your spouse dies, there's a double whammy for the the surviving's spouses IRA withdrawals. First, there's the Increased taxes paid on future RMDs since the surviving spouse moves from the MFJ to single status. Secondly, depending on the age difference between the 2 spouses, may accelerate future RMD withdrawal% significantly. The difference between the Surviving Spouse vs Married RMD schedule is almost double once the surviving spouse exceeds 80yo.
Post: Juggling for Retirees
Link to comment from January 21, 2023
John, it's too bad there's not a universal "future retirement financial planning course" that pre-retirement folks can take that touch on these topics. My self education has come through reading articles and comments from folks like you that contribute such learnings. A couple of other topical areas for consideration to add to the list that I have traversed over the 13yrs in retirement:
Post: Securing Lower Taxes
Link to comment from January 7, 2023