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It’s a sure bet that no one — regardless of age — enjoys handing over any of their income to the IRS.
In retirement, though, doing so can feel like even more of a sting. Assuming you’ve left work earnings entirely behind you, any amount owed to Uncle Sam comes from your retirement income and savings — both of which also are expected to fund your golden years for, oh, another two or even three decades.
The good news is that there are strategies to reduce what you end up paying in federal — and, perhaps, state — taxes, which, of course, translates into more money staying with you. But getting there can involve some work.
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“To generate, on a regular basis, tax-free income over a long period of time, you have to put a lot of planning in place,” said certified financial planner Avani Ramnani, director of financial planning and wealth management at Francis Financial in New York.
For perspective: If you want your retirement savings to generate $100,000 a year in tax-free retirement income, and you want to adhere to the 4%-per-year withdrawal rule — in general, a rate that would make your money last for at least 30 years — you’d need at least a $2.5 million portfolio.
Of course, your own annual cash-flow needs may be higher or…
