tax planning for retirement Archives - ROI TV https://roitv.com/tag/tax-planning-for-retirement/ Tue, 10 Jun 2025 14:40:12 +0000 en-US hourly 1 https://wordpress.org/?v=6.8.1 Your 11 Step Path to Financial Freedom https://roitv.com/your-11-step-path-to-financial-freedom/ Tue, 10 Jun 2025 14:40:11 +0000 https://roitv.com/?p=3133 Image from Your Money, Your Wealth

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Everyone wants financial freedom—but most people don’t have a plan to get there.

In this episode of Your Money, Your Wealth, Big Al Clopine and I laid out 11 specific steps that can guide you toward building and sustaining true financial independence. It’s not just about saving more—it’s about thinking strategically and living intentionally.

Here’s how you can get there:


Step 1: Take Inventory of Your Net Worth

Start by calculating your net worth:
Assets – Liabilities = Net Worth

List out your:

  • Bank accounts
  • Retirement savings
  • Real estate
  • Jewelry or valuables
  • Any business assets

Then subtract your:

  • Credit card balances
  • Student loans
  • Car loans
  • Mortgage

You have to know where you’re starting before you can plot a course forward.


Step 2: Understand Your Cash Flow

Track your monthly income and expenses. Ask:

  • What’s coming in consistently?
  • Where is it going?
  • Are you spending more than you earn?

Financial freedom depends on positive, intentional cash flow, not just a big salary.


Step 3: Define What Financial Freedom Means to You

It’s different for everyone:

  • 54% say it means being debt-free
  • 50% say it means living comfortably
  • Only 13% say it means being rich

Your version of financial freedom should reflect your values, not someone else’s lifestyle.


Step 4: Pay Off Bad Debt

High-interest debt—especially credit cards—kills financial momentum. Example:

  • $8,600 balance
  • $272/month payment
  • 53 months to pay off
  • $5,600 in interest!

Make a plan to eliminate debt aggressively.


Step 5: Build an Emergency Fund

Before you invest or upgrade your lifestyle, save 3–6 months of essential expenses. This keeps you from falling back on credit cards during life’s unexpected turns.


Step 6: Invest Strategically

Once you’ve got cash flow and a safety net, invest intentionally. Consider:

  • Diversified stock and bond portfolios
  • Real estate
  • Business ventures
  • Index funds

Remember: your investment mix should match your goals and risk tolerance.


Step 7: Maximize Tax-Advantaged Accounts

Use every tool the tax code gives you:

  • 401(k) or 403(b) — often with employer matches
  • Traditional and Roth IRAs
  • HSAs (if you’re eligible)

This reduces your tax bill now and in retirement.


Step 8: Consider Roth Conversions

Converting traditional IRA or 401(k) funds into a Roth lets you pay taxes now at lower rates and enjoy tax-free withdrawals later. It’s a smart move for many people in lower-income years or before RMDs hit.


Step 9: Create Passive Income Streams

These give you freedom from needing a paycheck:

  • Rental properties
  • Dividends and interest
  • Royalties or side hustles
  • Social Security (claimed strategically)

The goal: income that supports your lifestyle—even if you stop working.


Step 10: Adjust As Life Changes

Markets shift. Tax laws change. Health and goals evolve.

Revisit your financial plan annually:

  • Are your investments aligned with your risk?
  • Are your goals the same?
  • Do your withdrawal strategies need a tweak?

Financial freedom isn’t static—it’s dynamic.


Step 11: Think About Sustainability, Not Just Wealth

The final key? Sustain it.

Don’t burn out. Don’t blow it. Create systems that let you enjoy your money, give back, and live with purpose. That’s what real freedom looks like.


Final Thoughts

There’s no magic number for financial freedom—but there is a strategy. These 11 steps are designed to take you from wherever you are to a place where your money supports your life—not the other way around.

Start small. Stay consistent. And remember: freedom isn’t just for the rich. It’s for anyone willing to plan for it.

Intended for educational purposes only. Opinions expressed are not intended as investment advice or to predict future performance. Past performance does not guarantee future results. Neither the information presented, nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Consult your financial professional before making any investment decisions. Opinions expressed are subject to change without notice.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

• Intended for educational purposes only and are not intended as individualized advice or a guarantee that you will achieve a desired result. Before implementing any strategies discussed you should consult your tax and financial advisors.

The post Your 11 Step Path to Financial Freedom appeared first on ROI TV.

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How to Actually Reach Financial Freedom: The Strategy That Works https://roitv.com/how-to-actually-reach-financial-freedom-the-strategy-that-works/ Mon, 09 Jun 2025 11:50:44 +0000 https://roitv.com/?p=3126 Image from Your Money, Your Wealth

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Financial freedom looks different for everyone. For some, it means being debt-free. For others, it’s about living comfortably. But at the end of the day, true financial freedom comes when your passive income covers your lifestyle and you no longer have to work unless you want to.

In this week’s episode, Big Al Klopp and I broke down exactly what it takes to get there and stay there. It’s not just about saving more; it’s about thinking differently about money, time, and the future.

What Financial Freedom Really Means

According to recent data, 54% of people define financial freedom as being debt-free, and 50% say it’s about living comfortably. Only 13% equate it with being rich.

For us, financial freedom means your passive income matches or exceeds your expenses. That’s the point where you get to choose how you spend your time.

But here’s the catch: freedom comes from cash flow, not just net worth. If you have millions in assets but no income from them, you’re still on the clock.

The Roadblocks That Get in the Way

Most people don’t get stuck because they’re lazy. They get stuck because of:

  • Not saving enough
  • Carrying too much debt
  • Living paycheck to paycheck
  • Emergencies that wipe out savings

Take credit card debt as an example. The average balance is $8,600, and if you pay just $272 per month, you’ll be at it for 53 months and spend $5,600 in interest.

If you want freedom, the first step is cutting the chains and for many, that starts with credit cards.

3 Steps to Financial Freedom

Big Al and I recommend this simple process:

  1. Inventory – Know your numbers: assets, liabilities, net worth
  2. Invest – Grow your money through smart allocation
  3. Sustain – Build systems to maintain freedom over time

Calculating your net worth is key. Add up what you own (bank accounts, retirement plans, real estate, etc.) and subtract what you owe (mortgages, loans, credit card balances). That’s your starting point.

And remember: always pay yourself first. Before you spend on wants, contribute to your 401(k), IRA, or savings account.

Taxes: The Sneaky Expense That Eats Your Freedom

Taxes are one of the biggest threats to financial independence. In California, a single filer earning $100,000 nets just $72,000 after taxes.

Want to fight back? Use:

  • 401(k) and IRA contributions to lower taxable income
  • Roth accounts for tax-free growth
  • Capital gains strategies married couples can pay 0% on gains if income is under $94,000

And don’t forget: IRA and 401(k) withdrawals in retirement are taxed like ordinary income. Plan ahead, or risk surprise tax bills later.

Retirement Savings: It’s Never Too Early (But Don’t Wait)

The math is simple. If you start saving $700/month at age 30, you could hit $1 million by 65. Wait until 50, and you’ll need $3,500/month to get there.

That’s the power of compound interest time is your biggest ally.

If you’re self-employed, look into:

  • Solo 401(k)s
  • SEP IRAs
  • SIMPLE plans

And if your employer offers a match? Don’t leave free money on the table.

Build an Emergency Fund (Before You Need It)

Before you start investing aggressively, make sure you’ve got 3–6 months of expenses saved in a high-yield savings account. This keeps you from falling back on high-interest credit cards during emergencies.

Also:

  • Set up automatic bill payments
  • Monitor your accounts
  • Improve your credit score by paying on time and keeping usage low

Passive Income: The Secret Sauce to Sustainable Freedom

Want freedom? You need income streams that don’t depend on you clocking in.

Some options include:

  • Rental properties
  • REITs
  • Dividend-paying stocks
  • Social Security

If you wait until age 70 to claim Social Security, you’ll get 124% more than if you claim early. That’s a massive difference.

Plus, don’t underestimate side hustles like freelancing, consulting, or tutoring especially in the early stages of retirement.

Keep Adjusting Because Life Will

Markets change. Taxes change. Health changes. You need a plan that can adapt.

That’s why we talk about the 4% rule a guideline, not gospel. Some years, you may need to pull back to preserve your portfolio. That’s called managing sequence of returns risk retiring into a bad market could force you to sell investments at a loss.

Check in on your plan regularly and pivot when needed. Flexibility is freedom.

Final Thoughts

Financial freedom isn’t about getting rich. It’s about getting clear. Clear on your income, your expenses, your values, and your goals. It’s about using your money to support the life you want—not the other way around.

Whether you’re just getting started or refining your strategy, remember this: it’s possible. You can have a plan that works, a life that feels right, and a future you’re excited about.

You just have to start.

Intended for educational purposes only. Opinions expressed are not intended as investment advice or to predict future performance. Past performance does not guarantee future results. Neither the information presented, nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Consult your financial professional before making any investment decisions. Opinions expressed are subject to change without notice.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

• Intended for educational purposes only and are not intended as individualized advice or a guarantee that you will achieve a desired result. Before implementing any strategies discussed you should consult your tax and financial advisors.

The post How to Actually Reach Financial Freedom: The Strategy That Works appeared first on ROI TV.

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How to Catch Up on Retirement: Saving Smarter, Spending Wisely, and Planning Strategically https://roitv.com/how-to-catch-up-on-retirement-saving-smarter-spending-wisely-and-planning-strategically/ Tue, 06 May 2025 13:14:25 +0000 https://roitv.com/?p=2665 Image from Your Money, Your Wealth

The post How to Catch Up on Retirement: Saving Smarter, Spending Wisely, and Planning Strategically appeared first on ROI TV.

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When it comes to preparing for retirement, the numbers don’t lie—and for many Americans, they paint a concerning picture. According to a recent episode of Your Money Your Wealth, nearly one in three people feel significantly behind on their retirement savings. That sense of falling behind isn’t surprising when you consider that the median savings for those aged 55 to 64 is just $185,000. At a 4% withdrawal rate, that provides only $8,000 per year—far below the $82,000 average annual pre-retirement income.

So how can you close the gap? The first step is understanding how much you’ll need.

Calculate Your Retirement Shortfall

Joe Anderson and Alan Copeland walk viewers through a practical formula: subtract your fixed income (such as Social Security or a pension) from your desired annual spending. Multiply that shortfall by 25—or divide it by 4%—to determine the total savings needed. For example, if you need $75,000 per year and expect $50,000 from Social Security, you’ll need $625,000 saved to cover the difference.

Don’t let that number intimidate you. Even starting at age 40 with zero savings, you can get there by saving consistently and investing wisely. Saving $10,000 annually with a 6% return could hit your target by age 66.

Supercharge Your Savings

If you feel behind, you’re not alone—but there are ways to boost your efforts. Aim to save at least 15%–20% of your income. If you’re starting late, you may need to hit closer to 26% of gross income to replace 80% of your earnings in retirement.

Here are a few tactical tips:

  • Max out your employer match.
  • Set aside 50% of any bonuses.
  • Automate your savings increases with every raise.
  • Pay yourself first before spending on anything else.

Get Smart About Social Security

Timing your Social Security claim is one of the biggest levers you can pull. While you can start at age 62, doing so means locking in a permanent 30% reduction. Waiting until age 70, on the other hand, boosts your benefit by 8% per year past full retirement age—maximizing your lifetime income.

Joe and Alan also highlighted Social Security’s diminishing role as your income grows. For someone earning $15,000 annually, benefits may replace 80% of income. For those earning $150,000, the replacement rate drops to just 30%. In other words, the more you make, the less you can rely on Social Security alone.

Minimize Taxes in Retirement

Don’t underestimate the impact of taxes on your retirement income. Required minimum distributions (RMDs) from traditional accounts, plus the loss of common deductions in retirement, can push you into a higher tax bracket than you expected.

Alan emphasized the importance of tax diversification. Spreading your savings across tax-deferred (like traditional IRAs), taxable brokerage accounts, and tax-free Roth IRAs gives you more flexibility—and more control—over your tax bill.

Consider Roth Contributions and Conversions

Roth IRAs provide powerful benefits: tax-free growth and withdrawals. For 2025, you can contribute $7,000—or $8,000 if you’re over 50. And even if you can’t contribute directly, you can consider Roth conversions. Moving money from a traditional IRA to a Roth IRA means paying taxes now but avoiding potentially higher taxes later.

This strategy can be especially effective in the years between retirement and RMD age, when your taxable income is lower.

Define Your Retirement Vision

It’s not just about the numbers. Joe and Alan encourage writing down your retirement goals—when you want to retire, how much you plan to spend, and whether you plan to relocate or downsize. Studies show that those who write down their goals are far more likely to achieve them.

A good retirement plan includes:

  • Savings benchmarks
  • Social Security strategy
  • Investment allocation
  • Contingency planning for health care or unexpected expenses

Use the Right Tools

To help you get started, Your Money Your Wealth offers a free Retirement Readiness Guide. It’s packed with worksheets and step-by-step instructions to calculate how much you need, how to save, and how to draw income efficiently.

Whether you’re decades from retirement or staring it down in the next few years, planning now can ensure you retire with financial confidence.

Intended for educational purposes only. Opinions expressed are not intended as investment advice or to predict future performance. Past performance does not guarantee future results. Neither the information presented, nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Consult your financial professional before making any investment decisions. Opinions expressed are subject to change without notice.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

• Intended for educational purposes only and are not intended as individualized advice or a guarantee that you will achieve a desired result. Before implementing any strategies discussed you should consult your tax and financial advisors.

The post How to Catch Up on Retirement: Saving Smarter, Spending Wisely, and Planning Strategically appeared first on ROI TV.

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