(ConservativeJournal.org) – Retirement planning begins with taking a hard, honest look at your finances and future goals. Finding answers to critical questions, such as where you plan to retire, how much money you’ll need, and how to balance your funds, can help you face the future confidently. Figuring out where you want to spend the rest of your golden years also matters, as some locations may be more affordable than others. Choosing a state that doesn’t tax retirement income could help you stretch your retirement money even further.
These States Don't Tax Retirement Income https://t.co/7NeuV1B2Gt
— Daniel S Romero, CFP® (@17thStJournal) August 11, 2022
According to AARP, a total of 12 states either tax funds only in very specific circumstances or do not tax retirement income at all. Pennsylvania, Illinois, and Mississippi exempt distributions from 401Ks, Social Security benefits, and IRAs. Nine other areas don’t apply taxes to retirement money simply because they don’t institute an income tax in the first place:
- Nevada
- New Hampshire
- Florida
- South Dakota
- Tennessee
- Texas
- Alaska
- Washington
- Wyoming
Moving to one of these locations can help retirees pinch pennies simply because they aren’t paying out as much in taxes. This strategy leaves more money available for survival and fun — a big benefit for people living on a fixed income.
Detailed planning is the key to a successful future retirement. Don’t be afraid to consider relocating to a new area to live out the rest of your life. Moving just might help you achieve the financial stability and freedom you truly deserve.
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