What kind of taxes should you expect to pay during retirement?
Some people wonder, “Will I pay taxes in retirement?” The answer to this question is not as straightforward as some people think. In short, yes, you will pay taxes on any earned income. So, unless you have no income, you still have tax responsibilities. However, what people might mean by that question is something along the lines of “What can I expect to pay in taxes during retirement?”
If you have a brokerage account that has gains over the years, and then you sell things in that brokerage account, then you’ll pay capital gains tax on what you gained. Another tax you might have to pay would be an income tax on your IRA withdrawal. You will also pay income tax on some parts of your Social Security benefits. However, how much depends on your total income. Furthermore, if you’re working part-time in retirement, then your paycheck gets taxed as well. So, you will likely still be paying taxes in retirement. The only way to avoid it would be to have everything in cash and maybe a Roth IRA because Roth IRAs can be withdrawn tax-free.
Have more questions? Contact Us
Casey Smith
President, Wiser Wealth Management
Click here to schedule a consultation with one of our financial planners.
Listen to Our Podcast:
Recent posts
Share This Story, Choose Your Platform!
Wiser Wealth Management, Inc (“Wiser Wealth”) is a registered investment adviser with the U.S. Securities and Exchange Commission (SEC). As a registered investment adviser, Wiser Wealth and its employees are subject to various rules, filings, and requirements. You can visit the SEC’s website here to obtain further information on our firm or investment adviser’s registration.
Wiser Wealth’s website provides general information regarding our business along with access to additional investment related information, various financial calculators, and external / third party links. Material presented on this website is believed to be from reliable sources and is meant for informational purposes only. Wiser Wealth does not endorse or accept responsibility for the content of any third-party website and is not affiliated with any third-party website or social media page. Wiser Wealth does not expressly or implicitly adopt or endorse any of the expressions, opinions or content posted by third party websites or on social media pages. While Wiser Wealth uses reasonable efforts to obtain information from sources it believes to be reliable, we make no representation that the information or opinions contained in our publications are accurate, reliable, or complete.
To the extent that you utilize any financial calculators or links in our website, you acknowledge and understand that the information provided to you should not be construed as personal investment advice from Wiser Wealth or any of its investment professionals. Advice provided by Wiser Wealth is given only within the context of our contractual agreement with the client. Wiser Wealth does not offer legal, accounting or tax advice. Consult your own attorney, accountant, and other professionals for these services.