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Financial Planning / Tax Strategies


Subject:  Re: Retirement Spending Date:  7/27/1999  4:15 PM
Author:  edcosoft Number:  17703 of 127753

One suggestion. Let your 401K grow untouched. When your 59 1/2 you can Lump Sum Distribution it at special 10 year averaging methods. Then put it in Vanguard Tax Managed G &I Fund and after a couple of years withdraw what you need at Long Term Capital Gains rates. The sooner you do this the better to keep the 10 year averaging top bracket low, but can't befor 59 1/2. This avoids what your wife thinks will happen at high tax rates.

Get your other funds into ones that only generate Long Term Capital Gains and live off them instead of Income generating funds. Cuts your taxes by about 30% to 33%.

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