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Synaesthesia

Joined: 07/25/2008 Posts: 5017
Likes: 1729


If you're paying higher % of taxes in retirement, you already won the game


There's basically no way to pull this off unless your retirement income is pretty close to your working years, and that was also a fairly high income. If taxes rose so high for even working stiffs that your retirement income is a lot lower but you were still paying about the same as when you were working, I absolutely guarantee that you lost more notional value on your assets than any amount of cumulative taxes you would've otherwise paid on it.

Roths really make the most sense for young people who aren't making much money yet but have good reason to expect that they will be making a lot more in the future. But if you're anywhere near your prime earning years, assuming you also don't completely screw the pooch on your portfolio management, it's almost certainly better to defer taxes in the present to somewhere in the future. Effective tax rates on the non-wealthy have been pretty flat the last several decades, with only a little bit of variation up and down. Even if they rise somewhat, the growth on the money on which you deferred taxes in the present is extremely likely to substantially larger than any future tax increase.

(In response to this post by HOKIERIT)

Posted: 04/20/2021 at 6:59PM



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