How to get entirely tax-free retirement income: Retirement Scan
How to get entirely tax-free retirement income
A health savings account can be used to cover medical bills and can also be a great savings vehicle for retirement, writes an expert on The Wall Street Journal. HSA contributions are deductible while savings grow tax-free and withdrawals are exempt from income taxes, writes the expert. "Because of the HSA’s triple tax advantage—the upfront tax deduction, tax-free growth and tax-free withdrawals for medical expenses—experts recommend that those who can afford to contribute to both an HSA and a 401(k) kick in the maximum to both."
There are 2 types of 401(k)s and most young people invest in the wrong one, says Suze Orman
Personal finance expert Suze Orman tells young clients to consider socking money away in a Roth 401(k) account if their employer offers it in their retirement plan, according to this article on CNBC. That's because they can save more money, as they pay taxes on the contributions while they are still in a lower tax bracket, says the expert. "Even when you start bringing in more, though, I suggest sticking with the Roth 401(k)... We don't know what the tax brackets will be when you retire. Right now they happen to be near historic lows."
4 great tax breaks for retirees
While seniors no longer qualify for some tax breaks after they retire, there are other tax deductions and credits that are available to them, according to this article on Motley Fool. These are the Lifetime Learning Credit, medical expense deduction and investment expense deduction. Those who make donations to charities are still eligible to deduct charitable contribution on their returns.
Where to retire in Florida
Florida is a popular destination for retirees because of its all-round weather, low taxes and a big retirement community, according to this article on Kiplinger. Seniors who intend to relocate to Florida in retirement and are looking for the best location in the state may want to consider Sarasota, Gainsville and Punta Gorda.
We're working longer, but are we dying sooner?
Social Security full retirement age is to increase to 67 in 2027 because of increased longevity, according to this article on Forbes. However, a report from Bloomberg shows that retirement is becoming difficult for today's older people, who are suffering from more health-related problems than those of the same age did 10 to 15 years ago.