February 27, 2013
Taxable, Traditional or Roth best?
For most, a blend of all three retirement account types—Roth, Traditional and Taxable is your best bet. An important point in favor of holding all three account types is income and income tax bracket control. The value of that control often gets lost in the shuffle prior to retirement because when you are working you have limited control over your tax bracket. By contrast, people who come into retirement with a diversified pool of assets can pick and choose how much to withdraw from each account type each year, thereby exerting some level of control over their income and tax bracket. In turn, they can reduce the taxation of other sources of income that are not part of their personal retirement investments, such as Social Security.