How Tax Planning Can Help to Secure Your Retirement: Financial Advisor Insights

Retirement Taxes: The Quiet Budget Breaker

Taxes can eat up more retirement dollars than market dips, but many people only see the damage after they start taking money out of their accounts. At that point, required minimum distributions (RMDs) and extra tax layers may cut yearly spending by thousands.

Headquartered in Greenville, TruNorth Advisors says the best time to start planning your retirement tax strategy is several years before you leave the workforce—when you still have the most control. During that window, earnings can still shift, letting you manage which tax bracket you will face later. They also stress that every account—tax-deferred, taxable, and tax-free—should work together like parts of one engine.

What Recent Surveys Show

A 2024 Allianz Life study found 64% of workers nearing retirement fear running out of money, with rising taxes ranked as their second-biggest worry. IRS data backs them up: more than half of filers over age 75 now pay federal tax on Social Security benefits.

Smart Withdrawal Timing & Roth Conversion Strategy

A well-planned withdrawal order can significantly improve retirement outcomes. Tapping a regular brokerage account first gives traditional IRAs more time to grow, while also helping retirees avoid “bracket creep” early on. Later, strategically mixing withdrawals from tax-deferred and Roth accounts can help keep more income within the 12% tax bracket and reduce the risk of higher Medicare premiums.

One powerful tool in this mix is the Roth conversion. Converting a portion of IRA funds into a Roth between ages 60 and 73 allows retirees to pay taxes at known, potentially lower rates now, while reducing future Required Minimum Distributions (RMDs). When spread over several low-income years, these conversions can generate substantial long-term tax savings.

Adaptive Planning & Legacy Protection

Of course, no plan should be static. Life changes, tax laws evolve, and financial priorities shift. That’s why experts, including TruNorth Advisors, recommend reviewing your strategy annually to reassess tax brackets, adjust withholding, and fine-tune withdrawal plans to match current rules and personal goals. Even small decisions—like when to sell stock or start a pension—can have a dramatic effect on long-term cash flow, as side-by-side forecasts and visual models often reveal.

Sound tax planning isn’t just about the retiree’s lifetime—it’s also about what happens after. Without preparation, heirs may be forced to drain inherited accounts, triggering unwanted tax burdens. Tools like clearly designated beneficiaries, well-structured trusts, and timely gifting strategies can go a long way in protecting your legacy and minimizing the tax bite for loved ones.

"Smart tax planning is one of the best gifts you can leave behind,” says Matthew Dixon, Founder and CEO of TruNorth Advisors. “It’s not just about reducing today’s taxes - it’s about making sure your assets serve you during retirement and protect your family for years to come."

Take Control Now

Taxes will never vanish, but careful planning keeps them from wrecking your budget. Starting early turns decades of saving into steady, after-tax income that supports both your lifestyle and your legacy.