I’m A Retirement Expert: Here’s EVERYTHING On Minimizing Tax

Comments · 28

• DO

  @DogFaceBoy1000 · 1 month ago

  Retired at 57, played the ACA game, used $$ under the mattress, CDs, wish I had a roth, probably saved $100k on insurance cost before medicare. also IIrma will be low for the first 2 years on medicare

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• US

  @user-99.99 · 1 month ago

  No brainer for me. Fed pension. Retired two years ago. [SCE (FF) at 50].  Planning to Roth convert a large percentage of my IRAs over the next decade. Currently filling out my 12% bracket.

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• TO

  @tommyconnor1019 · 1 month ago

  Informative Video!  Clearly, having a sizable brokerage account for your spending capacity allows for 4 years of ACA subsidies.  Did I miss how or where do they withdraw funds to pay for those large Roth tax bills over 9 years?

• EG

  @egah1-b4o · 1 month ago

  Excellent video. I appreciate seeing the detailed pros and cons (including the actual math) of each approach. But I think something is still missing. What about the opportunity cost of the money you use to pay the tax? If you do a Roth conversion and take money from whatever account to pay the taxes, that money is no longer invested and earning dividends and compounding. Surely that is a cost that should count against doing the conversion? I have never seen this mentioned on this or any other channel.<br><br>I will be 62 in a couple of months and I would love to see a deep video like this on the subject of whether to take Social Security at 62, or 63, or 64, etc. I believe the opportunity cost of continuing to withdraw money for current expenses, as opposed to taking Social Security early and leaving my money invested, would be a major factor tipping the decision toward taking Social Security early.

• TH

  @ThuyNguyen-Tiffastic · 1 month ago

  I would say for Roth Conversions - not just how much your projected taxes are, but how much and how fast your account will grow. &nbsp;If you convert $100,000 to Roth and it grows to a million dollars, then do it. &nbsp;Or else you will pay taxes on the growth of $900,000.

• JO

  @johnwilson839 · 1 month ago

  I&apos;m super curious if this couple could afford to self insure for 3 years. &nbsp;They have so much extra. &nbsp;Do the big Roth conversions and simultaneously skip the ACA market place. &nbsp;I think Medicare won&apos;t penalize you for not being insured for a couple of years prior to 65. &nbsp;Your burgeoning Roth becomes your disaster fund. &nbsp;If you are healthy for those 3 years then you win big, and if you get a cancer diagnosis you will take a big hit. &nbsp;But, you had the wherewithal to make a gamble that avoids all of the stress involved in accessing healthcare through a stupid bureaucratic insurance company. &nbsp;I&apos;d model that out and see if it could work for me if I was in as good a position as they are.

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• KA

  @karenmikola1552 · 1 month ago (edited)

  Question at the <a href="https://www.youtube.com/watch?v=ourrAFoC9xc&amp;t=2340">39:00</a> mark. &nbsp;I see that you have included the fact that you need to do an additional brokerage account withdrawal to cover taxes ($141,024), but I don&apos;t see it included in your running MAGI. &nbsp;Am I missing something? &nbsp;Great video on the finer details.

• CL

  @Clevertechly · 1 month ago

  A question, maybe not for someone with this much money, but if your RMD will supply a portion of your money, and then you identify Roth conversion amount, smaller than needed to fill a bracket, could you then use the rest of the bracket for Cap Gains harvesting?

• RL

  @rlaager · 1 month ago

  <a href="https://www.youtube.com/watch?v=ourrAFoC9xc&amp;t=2055">34:15</a> Why would the dividends and interest be non-spendable if it is less than they want to pull from taxable? If they reinvested it, it would be the highest cost basis and thus the first thing sold anyway, so they end up spending it no matter what, right?

• AN

  @ancient_dragon · 1 month ago

  I have a question about your living expenses breakdown slides. I see you have listed &quot;Non-spending taxable income&quot; which include the dividend income generated from the taxable brokerage account. You mention these dividends are reinvested, which is why they are &quot;Non-spending&quot; income. Then in the slide you also generate &quot;brokerage cash for lifestyle&quot;, I assume by selling stocks from the brokerage account. Why do you reinvest the dividends from the brokerage account instead of using these to help fund your lifestyle since they were already taxed? Basically I am wondering if there is a strategy as to when you should take the dividends and use them to help fund your lifestyle, and when you should reinvest them. Is one of them always a winner? Or what determines the choice?

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• GI

  @gizmobowen · 1 month ago

  Great video and I really loved the in-depth analysis that you illustrated with determining the current and future values of doing a conversion. &nbsp;There is a lot of helpful information to keep in mind, especially when using a &quot;dumb&quot; conversion tool.<br>If I understand it correctly, the ACA subsidy opportunity really only presents itself because of the large taxable amount (~1.3 mil) and the small annual income requirements? &nbsp;This seems to be a very common way to structure an example, unfortunately it isn&apos;t relevant to my specific asset location mix.<br>I&apos;m assuming I&apos;m an exception with over 90% of my savings in after-tax accounts. &nbsp;This doesn&apos;t give me the option of managing my MAGI during pre-Medicare years.<br>I also believe that if you have such a large spending capacity, there is more value in using more of your money in the early years, while your health is as good as it can be.<br>So, for my scenario, higher spending means lower opportunities to fill tax brackets and totally takes subsidies out of the equation. &nbsp;I know you do a ton of work to create these videos and portfolios like mine may be in the minority, but I&apos;d love to see an example where the portfolio has essentially no taxable savings, just to see how things change and to prove or disprove how I am seeing it.<br>Thanks again for showing a lot of the &quot;hidden&quot; math that goes into a thorough analysis of doing a conversion.

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• TO

  @Tony-dx3eo · 1 month ago

  Unfortunately-the Roth conversions shown include years where they&apos;re drawing Social Security. This will most likely result in 85% of their Social Security benefis being taxable which will significantly increase their effective tax rate. &nbsp;Marginal rates don&apos;t show impact of SS taxation.

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