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I'm 44 and am in a position to be able to retire in a few years if I so desire. I have a rental property and am ready to buy another in the next 6 months. As for stocks, 10% of my portfolio is in a Roth IRA, 87% in a traditional IRA, and about 3% in a 401k.

In retirement I will live largely off my stocks, I am successful growth investor. What is the most tax efficient way to manage my $$? A 72t annuity withdrawal from my traditional IRA doesn't look good, as the calculator limits don't fit my budgeting needs. Also, who is the best type of financial advisor to discuss these issues with? I would assume a fiduciary financial advisor.

Any advice or pointing me towards the best posts or websites would be greatly appreciated.

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I hesitated to reply because others are far more knowledgeable than I...

You are caught in the trap many people did not anticipate (but the government did). Put away alot of money pre-tax under the impression their retirement tax rate would be lower. It often does not turn out that way. In your case, you are going to pay withdrawal penalties on top of potentially higher tax brackets. In retirement you are likely to encounter the problem of withdrawals resulting in social security benefits being taxed and you are in a higher tax bracket as well as impacting Medicare premiums. The government never loses. :(

Your most tax efficient way to manage your $$ is to keep working (albeit part time?) and any money going into traditional IRAs should be after-tax deposits. Then, when you do retire, find a way to limit your withdrawals and income to match your expenses. Not an easy task.

As for advisors, with no disrespect to those MF reading the boards, DIY. In the 25 years since I retired at 43, I have not found a single FA who could provide better advise than what I could figure out by myself. FA have a number of fiduciary responsibilities that force them to be conservative and traditional in their advice. This might not match your philosophy or situation.

If you look hard enough and research enough, you can find everything you need without paying someone else to tell you the same thing.

Just my 2 cents worth....

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Thanks Paul. What about a roth ira conversion ladder? From my recent research, that seems to be one of the best ways to reduce my tax bill in retirement, although it takes 5 years to build up.

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Hey Jeff, A couple of ideas for you. First of all, since your net egg is heavily weighted to retirement accounts, you want to start some positions in a brokerage (taxable) account. The Roth and IRAs won't allow you to pull funds out until you are 59 and a half which hampers things for the FIRE crowd.

I'm 53 now and semi-retired. I am still working at a job I love (thanks to The Motley Fool), and only have to pull out about 1% from my savings to cover expenses for the year. BTW, my wife does work for the University of North Carolina and we get our health benefits through her employer.

We have about 30% of our overall funds in a taxable brokerage account, which will cover us under our current spending and employment situation for another 20 years. We could fully retire which would cut the brokerage account's ability to fund our lifestyle to more like 10 years.

How have we built up such a large amount in our brokerage? First, I always made sure we maxed out our contributions to the 401K, but only up to the match amount from our employers. Beyond that, I found it didn't make sense. I couldn't invest in individual stocks in the 401K, and the tax treatment of a 401K/traditional IRA (taxed like regular income) was worse than putting in a brokerage account and paying capital gains tax when you eventually sell.

If you are at a salary level where you could convert some of your money from your traditional IRA to the Roth (I think that's what you meant by Roth conversion ladder), that would be something to consider. We have 40% in our IRA, and 30% in our Roth. We plan to pull out of our brokerage account first, then the IRA, then the Roth. Ideally, we can stretch the limits until we are forced into RMDs (required minimum distributions). I think we'll be able to do that. Having money in all three accounts allow us to more or less control our tax situation for many years to come.

Rental properties can also offer a nice way to get some recurring passive income to allow you to put off pulling from stock accounts, but know that that strategy has risks too. The money you are putting into rental properties could be used to buy stocks in a brokerage account. Not sure which would be better for you. I've always thought managing rental properties was way more work than watching my stocks.

Dividend-paying stocks (in a brokerage account) is another way to generate passive income. I like my growth stocks too much to dip my toes into these kinds of investments, but the report below is pretty compelling.

Basically, it showed how if you had $1M in dividend aristocrats in 1990, you could have pulled out $50K a year for living expenses and end up with almost $15M by the end of 2019. Wow!

Hope this was helpful.
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