Tips for using the Retirement Tax Saver Calculator

1. Read the book From Savvy Saver to Smart Spender: How to Pick a Tax-Wise Retirement Withdrawal Strategy. It provides important background information, will help you identify the information you need to get the most benefit from the calculator, and show you how to use the results. The book is available here. For example, the book will:
   1. Explain what the inputs are.
   2. Explain what results mean.
   3. Guide you as to good withdrawal numbers to try using Strategy B, saving you time with finding your best option.
   4. Talk about Social Security, including how the date Social Security starts may affect the results, and how Social Security is taxed.
2. Read the information bubbles that are marked next to several of the inputs to the Calculator. They give useful tips and information to help you input the proper information.
3. Remember: the Calculator provides federal income tax results only. If you are in a state that taxes income, there is a good chance that a Strategy B option that saves you federal taxes will also save state income taxes. However, the Calculator (at least in its current form) does not account for state income taxes.
4. If you are not seeing significant savings when you try different withdrawal amounts with Strategy B, consider the following:
   1. Try using a higher target income. Your target income might be so low that the tax benefit is reduced or eliminated. Rule of thumb: take 4% of your assets and add you other income.
   2. Even if the tax savings are small or nonexistent, there may be benefits to Strategy B. Even if you don't see tax savings by age 90 using Strategy B, you probably will have more money in the already-taxed accounts (ideally, Roth IRAs and Roth 401(k)s) and less in the accounts that are taxable on withdrawal (Like your regular 401(k) and IRA accounts) than if you use Strategy A. All other things being equal, more assets in already-taxed accounts, the less it will be taxed to your or your heirs in the future.
5. Talk to your financial advisor about the results (if you have one). The Calculator may not give you a "Final Answer" for what to do, depending on your situation. Talking to your advisor about the results, however, will make potential savings part of the discussion. And as the Book shows (see Tip #1), that potential savings could total tens of thousands of dollars, or even more, over your retirement years.
6. Review the numbers and reuse the Calculator at least once a year. Your account values will likely change and updated the inputs will lead to better results going forward.