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Section 10
Unexpected Retirement Taxes
When piecing together retirement income, many retirees focus
on generating a certain dollar amount of income to meet their
needs, but fail to factor in the effect that taxes will have on that
income. Taxes should be considered, just like any other expense
in retirement, and one that may cost you up to roughly 30% of
your retirement income.
Social Security Taxes
Everyone sees deductions from their paychecks each month
for Social Security, but a lot of people don’t realize that they
may also have to pay taxes on Social Security income when
they start receiving it. You may pay taxes on up to 85% of that
income depending on your combined-income total. Here are
the guidelines for taxation of your Social Security benefits:
Chapter 5: Things That Can Wreck Your Retirement
