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Strategies to Manage Taxes in Retirement

One way to potentially lower taxes in retirement is to start taking distributions from tax-deferred accounts before it’s required. Again, once you reach age 59½, you can withdraw funds from those accounts without paying the 10% early-withdrawal penalty. The withdrawals are still taxed as ordinary income, but over time they reduce the size of tax-deferred accounts, and thus the size of your RMDs. Another reason to access those funds before 70½ is that it could help you delay taking your Social Security benefit, which increases in size the later you take it, up to age 70.

That said, it’s important to look at your tax situation at age 59½ before taking early withdrawals. For the many Americans who will still be working at that age, withdrawing too much could push them into a higher tax bracket. Taking Social Security benefits could also push you into a higher tax bracket, but keeping RMDs low means less income would be subject to the higher tax rate.

One of the most popular and appealing strategies for reducing the potential tax consequences of RMDs is converting a traditional IRA or 401(k) plan into a Roth IRA before the age of 70½. Roth IRAs are funded with after-tax dollars and thus are exempt from RMDs during the owner’s lifetime — and when the funds are withdrawn, both the principal and earnings are tax-free. It’s worth noting that the act of converting to a Roth IRA is a taxable event and the five-year rule still applies.

A Roth conversion may make sense when you’re certain you’ll be in a higher bracket when you eventually withdraw the money, which is often the case once RMDs and Social Security are factored in. It may also be a good option when you don’t need the money, aren’t concerned about paying income taxes and would like to leave an income-tax-free Roth IRA to your heirs.

Lastly, if you make a full or partial conversion to a Roth IRA, you may be able to reduce the resulting tax burden via charitable giving during the same year as the conversion — though the donation can’t be funded from your retirement accounts.

There’s a lot to consider as you plan for how to manage your tax obligation in retirement. Consulting with a financial professional, and particularly a tax adviser, can help ensure your choices are most advantageous for your situation.

Catherine Golladay is senior vice president for 401(k) participant services and administration with Schwab Retirement Plan Services.

The information contained herein is proprietary to Schwab Retirement Plan Services Inc. (SRPS) and is for informational purposes only. None of the information constitutes a recommendation by SRPS. The information is not intended to provide tax, legal, or investment advice; please consult with your accountant or investment adviser for how this applies to your specific situation. SRPS does not guarantee the suitability or potential value of any particular investment or information source. Certain information provided herein may be subject to change.

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Earn An Income Through Article Marketing

Earn An Income Through Writing Articles – Article Marketing for Cash

Article marketing is one of the most effective ways to begin earning income on the internet. You’ll be able to work from your residence , establish your own schedule and start with very little to no cash . Once you’ve learned the fundamental principle , you can start writing articles and earning money in not much time whatsoever. Countless numbers of men and women just like you are making a full time income or just extra cash through article marketing.

The concept behind article marketing is that you just write an article about a problem folks have or a item you understand they want or need. Let’s look at barbecue grills for example. You write an article extolling a certain model of barbecue grill, maybe one you have at home. Talk about the positive aspects of that grill and why it is such a good one. In a nutshell, you are writing an ad for that grill’s online marketing.

Now the thing is, at the end of your article there’s a link to the item. Every time the reader clicks on your link, the corporation keeps a record and sends you money making the sale. And the greatest part is you could receive cash for writing about pretty much anything you could think of from aquariums to barbecue grills.

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Writing For Money – Turn Your Words Into Cash

Writing articles is one of the best ways to start making money online quickly, without any costs upfront. If you have decent grammar and typing skills, you will be able to write articles for money. The process to start writing articles for pay is very simple and straightforward.

Write for Cash is a great way to make extra money in your spare time, giving you the freedom to work when you want and setting no limit on the amount you can earn.

Firstly, cautiously pick out your topic. If you are new to writing articles online then the best way to start is to write about something you know just to get into the practice of writing.

Use all your cleverness when writing the heading meant for your article. The title or the heading is the most indispensable part as if it does not appeal; people will not read your article. Do not rush it and make sure that it does take hold of the attention of your readers. You can catch the attention of or the interest of your readers by using awareness grasping announcements or by asking an interesting question.

Freelance writing usually involves writing articles for people that need content for web pages or blogs. You can typically get paid from $3 to $10 per article depending on the word count and your writing skill.

Article marketing (aka bum marketing) typically involves promoting affiliate products by writing reviews or descriptive articles about them. You will include an affiliate link that will track any purchases made by your visitors. You will in turn make a commission from these sales.