Tax Strategies for Retirement
After years in the work force, retirement is finally within your reach. Unfortunately, Uncle Sam can put a damper on any retirement plan. Arm yourself with these methods to cut the federal government's take and tax strategies to help make your dream retirement a reality.
ThirdAge Profile
John Houghtaling, 53, doesn't know much about his retirement other than it's coming soon and he wants to be able to pay for it. The idea of buying an RV and traveling the country appeals to him. So does selling his lakeside home and moving to Arizona. He's spent his whole career making hunting rifles for the Remington Arms Company near Cooperstown, N.Y. Now he wants to get the most out of his retirement nest egg without overpaying the government.
Houghtaling has been making regular payments into his 401(k) ever since 1974 -- and the fund has done very, very well. It's up in the six figures. But Houghtaling wants to retire before the age of 59 1/2 and tap into the "mother lode" without suffering the early withdrawal penalty. Somebody at work told him there's a special method that helps skirt the 10 percent penalty, but he can't get a straight answer out of his human resources department. Other than his home, he has no other assets that he would consider using to provide a retirement income prior to age 59 1/2. He does own a classic car worth $12,000, but that wouldn't be enough. Selling his house -- combined with his pension income -- would allow him to live comfortably for 15 years.
ThirdAge Money Insider Jeff Fleming Advises:
 Pre-Retirement Strategies for Retirement Bliss
Cashing in Early on Retirement Plans
Shelter Income From Taxes
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