There’s no question about it, that when it comes to saving for retirement, the financial mass media pounds the table with all things retirement accounts like IRAs and 401(k)s, but there’s a vastly underutilized investment vehicle that can help retirees enjoy a potential 6-figure retirement income, entirely tax-free.

We are referring to the good olé brokerage account.

A brokerage account is simply an investment account you open where you deposit money from your own bank account and then you can use that cash to invest in various investments held inside that brokerage account. Most commonly, people will invest in things like stocks, bonds, mutual funds, ETFs, things of that nature.
In this episode, I teach you how you might utilize a brokerage account for a 6-figure retirement income, tax-free.

More specifically, we discuss:

• The difference between a brokerage account and a retirement account such as an IRA or 401(k)
• How a pre-retiree might accumulate funds inside of a brokerage account
• How taxes work when it comes to brokerage accounts and the investments held inside them
• How exactly you can end up paying no federal taxes on over 6-figures of income
• Hypothetical scenarios (basic concept and real-world)
• The importance of a retirement income plan and investment strategy

Resources:

• Access Episode Show Notes and Sign Up for the Retired·ish Newsletter
• Ask Cameron A Question!

Key moments:

(03:44) Build brokerage account for retirement income flexibility

(07:35) Pre-Tax IRA/401(k) assets taxed as ordinary income, brokerage assets can be subject to lower long-term capital gains rates

(10:08) 0% capital gains tax up to $96,700 for married filing joint in 2025

(12:07) Conceptual Scenario: high 6-figure income in retirement, zero taxes

(15:24) Real-World Scenario: high 6-figure income in retirement, zero taxes

(23:02) Key points when using brokerage accounts as part of your retirement income strategy

Building up a substantial amount of savings in your 401(k) or IRA may serve as an indicator for a job well done in saving for retirement.
But what soon-to-be retirees need to realize is that if the majority of your retirement savings is in pre-tax dollars, taxes will eventually be owed while in retirement and taking distributions.

Depending on your tax situation in retirement and the tax laws in place at that time, these large account balances may cause a tornado of taxation that you weren’t expecting - which can cause you to have to rethink your retirement strategy altogether.

In this episode, Cameron discusses why pre-retirees should reconsider building up their pre-tax retirement account balances, and what to do instead.

More specifically, we discuss:

• The potential tax problem Cameron has seen recently when talking with those age 50+
• The “shadow taxes” that await you in retirement
• The potential tax ramifications of building up large pre-tax IRA and 401(k) balances
• Alternatives to saving money on a pre-tax basis
• Why tax rates are likely to be higher in the future
• Roth conversions
• How to mitigate or avoid estimated tax penalties when implementing Roth conversions

Resources:

• Access Episode Show Notes and Sign Up for the Retired·ish Newsletter
• Ask Cameron A Question!

A Roth IRA offers tax deferral on any earnings in the account. Qualified withdrawals of earnings from the account are tax-free. Withdrawals of earnings prior to age 59 ½ or prior to the account being opened for 5 years, whichever is later, may result in a 10% IRS penalty tax. Limitations and restrictions may apply.

(01:58) Those age 50 and over should slow down building up pre-tax 401(k) and IRA.

(06:01) Roth 401(k) employer match/profit sharing is taxable; 401(k) plan document dependent.

(07:48) Tax deduction today, or in retirement? Time Value of Money concept isn’t always what it seems.

(10:13) Consider choosing Roth IRA/401K over traditional savings moving forward.

(15:09) Optimize tax strategies with underutilized brackets.

(16:22) Potential tax changes could affect inheritance complexities.

(18:27) How to pay for taxes due from a Roth conversion and avoid underpayment penalties.

The landscape of taxes, retirement savings and Medicare are ever changing.
Every year we see changes to the laws and limitations such as tax rates, brackets, and deductions, limitations on retirement plan contributions, and premium changes to Medicare to name a few.

2025 brings us some run of the mill changes sprinkled with substantial changes that can largely benefit retirees and soon to be retirees.

In this episode, we discuss some of the most important changes and how they may affect you.

More specifically, I discuss:

• Important adjustments to common tax deductions and tax rates
• Changes in the gift and estate tax landscape
• New retirement savings laws and updates for those still working in 2025
• Important changes for Medicare and prescription drug plans
• Social Security related updates for 2025

Resources:

• Access Show Notes and Sign Up for the Retired·ish Newsletter HERE
• Ask Cameron A Question!

Key moments are:

(00:00) 2025 standard deduction amounts increased for inflation.
(05:32) Estate tax exemption may significantly decrease post-2025.
(09:40) Those ages 60-63 can now put more into their employer sponsored retirement plan in 2025
(12:29) Employers can now contribute Roth, impacting taxes.
(17:41) High out-of-pocket costs for Medicare prescriptions.
(20:07) Out-of-pocket drug costs capped at $2,000.
(22:59) 2.5% COLA for Social Security in 2025. Wage limit increases 4.5%.