February 25, 2020

Setting Up For Tax-Aware Retirement Success

The government wants their “cut” and one way or another, Uncle Sam will get his money. When you take a disbursement from a traditional 401, IRA or qualified account Uncle Sam will be waiting with a purse in hand to collect the tax on your withdrawal.

Many Americans don’t plan for this tax on their disbursement and think it’s tax-free. The government always gets its cut, whether you contribute to a post tax (Roth IRA) or a pre-tax (traditional IRA/401k).

People don’t plan for the net effect of taxes on their retirement income (or social security…see above).

With guidance from your tax-aware retirement planner, you can find out if those taxes to the government are sustainable long-term and look at the effect on your retirement portfolio with the additional withdrawals to make up for a shortfall.

What is a Buffer Asset?

Buffer assets are assets that are put into more stable accounts within your portfolio. For instance, when the market is down, the value of your assets may fall. A buffer asset will help you buffer those ups and downs in the market as they are slow and steady maintenance assets.Safe Money Partners will help you identify and maintain the right kind of assets to meet your retirement goals.

Tax Aware Retirement: Buffer Your Risk

Your retirement options should have a mix of high risk, low risk, and buffer assets, advises retirement income planning consultant, Jeff Mohlman. If you are very young, you’ll be able to assume and invest in more high-risk options that could yield a greater return on your investments because you’ll have time to recoup what you might lose.

However, if you are nearing or at retirement age, you’ll want to have a buffer asset or more stable assets, with options for tax-deferred funds if needed.

A buffer asset becomes an additional asset-class that a retiree should consider learning about and have in their retirement mix.

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Take Lessons from the Past

You’re not going to change the past but lessons from the past should inspire you to create your future the way you want it to look.

Be in control of the choices available to you in your retirement, and don’t just “set and forget”.

The prior ways of going about your retirement planning just don’t work anymore.

The team at Safe Money Partners can help you by making you more tax-aware for your retirement planning. We will work with you to create a strategy using tax diversification to dramatically increase your retirement income and keep as much as possible in your pocket and out of Uncle Sam’s.


Tax-Deferred: This refers to monies that are invested without taxes being withheld so that when monies are withdrawn from the account later, any money that is withdrawn is subject to the current income tax rates at the time of the withdrawal. Accounts like this would include: 401K, 403B, and Deferred Annuities.

Taxable: This refers to accounts in which monies that are deposited are already taxed but the growth on the account is tax-deferred until they are withdrawn from the account. Accounts such as this can have an advantage at the death of the owner because they receive a step-up in basis. These accounts include non-qualified brokerage accounts, bank accounts, CDs, and money markets.

Tax-Free: This refers to accounts in which monies are deposited that have already been taxed and when future withdrawals are taken, the monies are all tax-free including the interest you earned. Accounts like this would include Roth IRA, Municipal Bonds, and Cash Value Life Insurance.

It’s easy to create the best plan for your retirement when you have the right tools and knowledge to help you. That’s where we come in-contact us today to discuss all of your options. We’re sure we can help you find the perfect plan to reach your financial retirement goals.

photo of Jeff Mohlman

By Jeff Mohlman

Jeffrey has developed a comprehensive network of financial planning and estate planning experts who work for their client’s short-term and long-term goals. Today, the approach he incorporates for his clients follows three basic tenets: 1) being debt-free, 2) maximizing after-tax retirement income, and 3) protecting their estate from unforeseen risks.