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TLDR:
Key Points:
- As a tax reporter for CNBC and a certified financial planner, Kate Dore focuses on tax strategy year-round.
- She discusses how her tax planning strategy has evolved over the past decade, emphasizing the importance of tax diversification in retirement planning.
Article Summary:
Kate Dore, a tax reporter for CNBC and a certified financial planner, discusses how her approach to tax planning has changed over the years. Initially, she focused on Roth savings due to her lower income and long timeframe until retirement. However, she has now shifted towards tax diversification across different investment accounts to provide flexibility in retirement. By prioritizing employer matches with pretax and Roth 401(k) contributions, making Roth IRA contributions, and investing in a taxable brokerage account and health savings account, Dore aims to have a mix of tax-deferred, tax-free, and taxable savings to draw from based on her yearly tax situation.
Tax diversification offers flexibility in retirement planning, allowing individuals to have different accounts to pull from depending on their tax situation each year. While certain tax moves may have future consequences, it is essential to have a diversified portfolio of investments based on individual goals, risk tolerance, and timeline, rather than solely focusing on tax savings. By considering factors such as income brackets, employer matches, investment options, and fees, individuals can create a balanced approach to tax planning throughout their career.
