How taxes affect retirement savings (and what to do about it)

When people think about saving for retirement, they usually focus on saving and investing so they have a nice nest egg when they stop working. And that’s a great place to start. But it’s also important to be mindful of how taxes affect your retirement savings and other income streams you’ll use after you reach retirement age.

Unfortunately, taxes don’t go away when you stop getting a paycheck. Even when you stop working, you continue to earn income in the form of retirement account payouts, Social Security benefits, and possibly pension payments. And if you underestimate bite taxes — yes, even if you’re retired — you could end up losing a significant chunk of your hard-earned cash.

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