Trusted Path
Wealth Management, LLC
May 2026
A sample plan for prospective clients
David and Sarah Chen are five years from retirement. They have enough. The question is whether the next three decades unfold tax-efficiently — or whether a quarter of what they built quietly leaks out as tax.
What follows is the plan we built for them.
Hardik Patel
707-264-1235 · hpatel@trustedpathwealth.com
This document highlights key strategies and outcomes from a comprehensive financial plan. It is a summary — not the complete plan document.
Meet the Clients
A fictional couple — built to reflect a real situation.
David and Sarah have spent three decades building. David leads a software engineering team at a Bay Area tech company. Sarah works in healthcare administration. They have accelerated their savings after fully funding college for their two kids. Their portfolio reflects 30+ years of discipline — maxed retirement accounts, reinvested RSU proceeds, and a lifestyle comfortably below their means.
For most of their investment life, they played offense. Aggressive equity allocations and annual maxes. Bull market tailwinds did the rest.
But something shifted — not the market, their mindset. The portfolio they have today can already support the retirement they want. The risk they need to take to get there is extremely low. So they stopped taking it.
That conservative allocation reflects a conscious decision, not a compromise. They've won the game. They're not interested in playing another round just to run up the score.
The following dialogue is illustrative. David and Sarah Chen are fictional characters, not actual clients.
We don't need to swing for the fences anymore. We just don't want to give back in taxes what good planning might have avoided.
— David
I want to travel for ten years while we're still healthy. I want to give to the things we care about. And I want our kids to inherit something useful — not a tax problem.
— Sarah
The biggest risk they face now isn't a bear market. It's the tax bill hiding inside a $2.47M pre-tax account — and the cost of not having a plan to deal with it.
The challenge isn't whether they have enough. It's making sure the next 30+ years unfold as tax-efficiently as possible.
30+ Year Plan — Key Milestones
Six moments where this plan changes shape.
Today
Ages 58 / 55
$4.1M invested
Plan begins
Retire
Ages 63 / 60
Roth conversions & travel phase begin
Mortgage Paid Off
David's age 69
3% fixed · paid on schedule
SS Begins
Age 70
Maximized benefit gain
+$770K lifetime
RMDs Begin
Age 73
RMDs start · QCDs primary
Yr 37 · Age 95
Plan horizon
~$8M invested portfolio
RMDs (Required Minimum Distributions — IRS-mandated annual withdrawals from pre-tax retirement accounts beginning at age 73)
QCDs (Qualified Charitable Distributions — direct transfers from a Traditional IRA to charity that satisfy RMD obligations without being counted as taxable income)
Travel & Lifestyle Phase (additional $25,000 / year)
Ages 63 / 60 — 73/70 · Roth conversions running in parallel
Legacy & Giving Phase
Ages 73–95 · SS income, QCDs, estate building
The Chens' Situation
Combined income of $564,572 · Net worth of $6.0M across five asset lines. The pre-tax IRA is the largest line — and the largest planning lever.
Annual outflows
How This Plan Works
Optimizing taxes across the plan lowers projected tax expenses, reducing required portfolio withdrawals while maintaining the same lifestyle and extending portfolio longevity.
Impact
$498,412 less total lifetime spending — driven primarily by lower taxes
The retirement-to-RMD window is a low-income opportunity period. Converting tax-deferred assets to Roth while managing tax brackets and IRMAA (Income-Related Monthly Adjustment Amount — a Medicare premium surcharge that applies when income crosses certain annual thresholds) thresholds builds long-term tax-free growth and increases legacy efficiency.
Impact
Significant lifetime tax savings
A structured withdrawal order—taxable first, then tax-deferred, then Roth—extends portfolio duration and allows tax-advantaged assets to compound longer for heirs.
Impact
$1,689,514 less drawn from pre-tax accounts — redirected to taxable withdrawals at preferential rates
The figure above in 01 and this figure measure different things and don't add together — one tracks total lifetime spending saved, the other tracks where the remaining spending comes from.
Bridging early retirement with taxable assets and Roth conversions enables delaying Social Security to age 70, increasing lifetime benefits through annual growth of approximately 8%.
Impact
$770,001 more in cumulative lifetime benefits
Coordinated use of a DAF (Donor-Advised Fund — a charitable giving account where a deduction is claimed upfront while distributions to specific charities happen over time), appreciated asset donations, and Qualified Charitable Distributions helps minimize taxes while maximizing charitable impact, especially during higher tax years and in retirement.
Impact
Improves after-tax charitable efficiency
Strategy 1 of 5
The Four-Axis Difference
Reference
Proposed
Reference
Proposed
Reference
Proposed
Reference
Proposed
Proposed strategy results in $1,523,668 more tax-adjusted ending assets than the reference strategy. Conversion refers to converting assets in a Traditional IRA, 401(k), or other tax-deferred account to a Roth IRA. Evaluate whether a conversion is appropriate for your specific financial circumstances.
Where Withdrawals Come From — Year by Year
Taxable withdrawals + Roth conversion income
Social Security begins + taxable/Roth blend
Social Security + RMDs + QCDs offset
Income sources shift across three distinct phases as tax efficiency evolves. In the early retirement window (ages 63–70), David and Sarah draw from taxable accounts and run Roth conversions simultaneously — keeping taxable income controllable and tax brackets low before Social Security begins. When Social Security starts at 70, it becomes the anchor of their annual income, reducing how much the portfolio must supply. After age 73, RMDs create a new taxable layer — managed through QCDs. Each phase is designed to minimize lifetime taxes while sustaining the lifestyle in full.
Asset location is different from asset allocation. Allocation is what you own. Location is where you hold it — and putting tax-inefficient investments (like bonds) in tax-sheltered accounts, while keeping tax-efficient ones (like index funds) in taxable accounts, can add meaningful after-tax return over time without taking more risk.
All accounts (pro-rata)
35% Equity / 65% Fixed
Taxable
Tax-deferred
Tax-free (Roth)
Why does the Roth hold mostly bonds? The taxable account ($1.4M) is large enough to hold nearly all of the portfolio's equity target on its own. Placing bonds in Roth instead of growth assets is the exception here — driven by account size, not convention. As the taxable account is drawn down in retirement, Roth equity exposure will increase.
Total portfolio allocation remains the same — the shift is purely about which assets sit in which account type for tax efficiency. Proposed strategy results in $1,523,668 more tax-adjusted ending assets · $516,867 less federal taxes paid · $1,689,514 less withdrawals from tax-deferred accounts.
Strategy 2 of 5
Between retirement and the start of Social Security and RMDs, income drops significantly — creating the most tax-efficient conversion window in the plan. Converting tax-deferred accounts to Roth during this period, while staying below IRMAA Medicare premium thresholds, means paying taxes at lower rates today so heirs inherit tax-free assets tomorrow.
The Tax Bracket Opportunity
2026 federal marginal brackets for married filing jointly — target the 22 / 24% band before SS & RMDs.
For many married couples filing jointly, the first IRMAA threshold occurs within the 24% federal income tax bracket, which makes it an important planning consideration for Roth conversions and other income decisions — conversion volume capped just below it.
Bridging the Early Retirement Years
01
Spending comes from taxable accounts. Conversions run in parallel — moving pre-tax funds to Roth while brackets are still low.
02
Capital gains rates are preferential — gentle on the tax bill.
03
Each year of delay raises the lifetime benefit.
04
From here on, much less pressure on the portfolio.
05
Lower taxes today + higher guaranteed income later.
Strategy 3 of 5
Withdrawal Sequencing Strategy
Which account do you tap first in retirement — and does it matter? It matters more than some might realize. Drawing from the wrong account at the wrong time can trigger higher taxes, increase Medicare premiums, and shrink what's left for heirs. The Chens follow a deliberate sequence: taxable accounts first, then tax-deferred (401k/IRA), then tax-free (Roth) — timed to keep their income in the lowest possible tax brackets each year.
First
Taxable brokerage
Ages 63 — 70
Capital gains taxed at preferential rates. Roth conversions run in parallel to fill 22/24% brackets.
Then
Tax-deferred (strategic)
Ages 70 — 73
Social Security at maximum. Pre-tax IRA / 401(k) drawn strategically, not by default.
Last
Roth IRA
Ages 73 — 95
RMDs satisfied first; QCDs offset. Roth preserved — grows tax-free, inherited tax-free.
First
Taxable brokerage
Then
Tax-deferred (strategic)
Last
Roth IRA
Ages 63 — 70
Capital gains taxed at preferential rates. Roth conversions run in parallel to fill 22/24% brackets.
Ages 70 — 73
Social Security at maximum. Pre-tax IRA / 401(k) drawn strategically, not by default.
Ages 73 — 95
RMDs satisfied first; QCDs offset. Roth preserved — grows tax-free, inherited tax-free.
Strategy 4 of 5
Narrative + Sequence Diagram
Delaying isn't a Social Security decision. It's a withdrawal-sequencing decision. The point of waiting until 70 is to convert volatile, taxable retirement assets into guaranteed, inflation-adjusted government income — at roughly an 8% annual exchange rate.
Ages 63–66
Phase 1 · Lean Bridge
Ages 67–69
Phase 2 · Last Call on Conversions
Age 70
Phase 3 · SS Turns On
Ages 71–95
Phase 4 · Compounding Surplus
What This Bridge Buys
Without the bridge, delaying isn't available. With it, the Chens trade a few years of tax-aware withdrawal coordination for an additional $770K of lifetime income vs. FRA — $1.87M vs. claiming at 62.
Side-by-Side Comparison
Cumulative across the plan horizon to age 95. Same family, same lifestyle — the only variable is the claim age.
Claim at 62 · Earliest Possible
$4.13M
Total income from this Social Security filing strategy. Baseline — no bridge required, every monthly check reduced for life.
Claim at FRA · 67
$5.23M
Total income from this Social Security filing strategy. Full benefit, no reduction — but no delayed-retirement credits captured.
Delay to 70 · Plan Choice
$6.00M
Total income from the Optimal Social Security filing strategy. Bridge funded by tax-aware withdrawals and Roth conversions.
Growth Per Year of Delay
~8%
Guaranteed by SSA, uncorrelated with markets
Break-Even Age
~82
Plan horizon to age 95 — 13+ years of surplus
Bridge Length
7 yrs
Ages 63 → 70 funded by taxable accounts & Roth conversions
Plan Choice Gain
+$770K
Cumulative income: delay-to-70 vs. FRA 67
Strategy 5 of 5
Why This Window Works
The Long-Term Payoff
Tax-Efficient Giving Strategy
Working Years
Peak Income Years
Age 70+
Tax-Adjusted Ending Wealth
Reference Strategy
$6,456,222
Proposed Strategy
$7,979,892
Tax-Adjusted Advantage
And the share of that estate that arrives tax-free doubles.
+$1,523,668
Risk Management
Actions to Close Gaps
4Umbrella Liability
Add $5–10M umbrella policy
Broad personal liability coverage at modest cost.
Earthquake Insurance
Cover the $2.4M home
Standard CA policies don't include quake. Use the CEA.
Living Trust
Establish or refresh trust
Avoid probate, ensure smooth transfer, maintain privacy.
David — Life Insurance
$300K term to age 63
Protects Sarah's income during the final working years.
Already Covered
2Long-Term Care
Self-funded
Modeled at ~$80K/yr inflation-adjusted. Portfolio supports it.
Disability Insurance
Both insured
75% / 72% income replacement, sufficient pre-retirement.
Monte Carlo Analysis
The bar literally shows the lift: hashed segment is what the reference plan already achieves; solid green segment is what the proposed strategy adds on top.
0%
floor
100%
ceiling
Reference Plan
78%
Of 1,000 Monte Carlo simulations succeeded under the reference strategy.
Proposed Plan
88%
Of 1,000 Monte Carlo simulations succeeded under the proposed strategy.
Difference
+10pp
Percentage-point improvement attributable to the proposed strategy.
This plan was tested across 1,000 Monte Carlo simulations and multiple adverse scenarios. The results demonstrate meaningful resilience — directly addressing the core concern of adverse market conditions in early retirement.
Probability of success across scenarios
1,000 Monte Carlo trials per scenario
How to read these scores
Each percentage reflects the share of 1,000 simulated market scenarios — including recessions, inflation spikes, and poor early-retirement return sequences — in which the portfolio still has money at age 95.
🟢90–100 Highly resilient. Holds up in nearly most conditions.
🟡75–89 Solid. Minor adjustments to spending or timing could address any gap.
🟠60–74 Workable, but dependent on favorable conditions or spending flexibility.
🔴Below 60 Meaningful shortfall risk. Plan adjustments recommended.
RightCapital defines success as: invested assets greater than $0 at the end of the planning horizon.
Base case
Baseline
Market drop immediately
Equity markets drop immediately by 20%
Taxes
Tax expense will be higher by 20%
Social Security cut
Social Security will be reduced by 20%
Longevity
You (and the co-client) will live 5 yrs. longer
Inflation
Inflation will be higher by 1%
Health care
Health care cost will be higher by 20%
Lower asset returns
Asset return will be lower by 1%
What This Plan Delivers
* Assuming recommendations and strategies are executed as modeled. See the full plan for complete assumptions and year-by-year projections. † All projected ending values are in future (nominal) dollars. At 2.5% inflation, $1 today equals approximately $2.19 in 32 years.
A note about this plan —
The difference between a good retirement and a great one is rarely what you invested in. It's the order of operations.
David and Sarah are fictional. But the situation isn't unusual: dual income, a large pre-tax account, charitable goals, and a retirement that's close enough to feel real.
Hardik Patel
Trusted Path Wealth Management
(707) 264-1235 · hpatel@trustedpathwealth.com · trustedpathwealth.com
Appendix
Key terms used throughout this plan, defined in plain English.
Capital Gains
Investment Appreciation Tax
The profit from selling an investment for more than its original purchase price (cost basis). Long-term gains — on assets held more than one year — are taxed at preferential rates of 0%, 15%, or 20% depending on income. Short-term gains are taxed as ordinary income. Donating appreciated assets directly to a DAF avoids capital gains entirely.
DAF
Donor-Advised Fund
A charitable giving account where a tax deduction is claimed upfront — typically in a high-income year — and distributions to specific charities happen over time. You can contribute appreciated securities directly, avoiding capital gains tax while claiming the full fair-market-value deduction.
IRMAA
Income-Related Monthly Adjustment Amount
A Medicare Part B and Part D premium surcharge triggered when modified adjusted gross income (MAGI) exceeds certain annual thresholds. Because IRMAA is assessed on income from two years prior, proactive Roth conversion planning and income smoothing can prevent unexpected surcharges in early retirement.
Monte Carlo
Probability-Based Projection
A method of stress-testing a financial plan by running it through 1,000 randomized return sequences. An 88% success rate means the portfolio did not run out of money in 880 of those 1,000 simulated market environments. It accounts for sequence-of-returns risk in a way that a single average-return projection cannot.
Pro-Rata
Spread Evenly Across Accounts
A default strategy where withdrawals or conversions are taken proportionally from all available account types — taxable, tax-deferred, and Roth — rather than in a deliberate order. A tax-efficient retirement plan avoids the pro-rata approach in favor of withdrawal sequencing, drawing from each account type at its most tax-efficient time.
QCD
Qualified Charitable Distribution
A direct transfer from a Traditional IRA to a qualified charity, available from age 70½. QCDs satisfy RMD obligations without being counted as taxable income — unlike a cash withdrawal followed by a charitable donation. This makes them one of the most tax-efficient giving tools available to retirees, especially those who take the standard deduction.
RMD
Required Minimum Distribution
An IRS-mandated annual withdrawal from pre-tax retirement accounts (401(k), Traditional IRA) beginning at age 73. Amounts are calculated based on account balance and IRS life expectancy tables, and are taxed as ordinary income. Failing to take the full RMD incurs a 25% excise tax on the shortfall. Strategic Roth conversions in the years before age 73 reduce future RMD amounts — and future tax exposure.
Roth Conversion
Pre-Tax to Tax-Free Transfer
Moving money from a Traditional IRA or 401(k) to a Roth IRA. The converted amount is taxed as ordinary income in the year of conversion — but all future growth and qualified withdrawals are permanently tax-free. The strategy is most powerful during the retirement-to-RMD window — typically ages 60–72 — when taxable income temporarily falls into lower brackets before Social Security and RMDs begin.
Tax-Deferred
401(k) / Traditional IRA
An account funded with pre-tax dollars. Contributions reduce taxable income today, but all withdrawals in retirement are taxed as ordinary income. Required Minimum Distributions begin at age 73. Large pre-tax balances can create substantial future tax obligations — both for the account owner and for heirs who must deplete inherited accounts within 10 years under current law.
Tax-Free
Roth IRA / Roth 401(k)
An account funded with after-tax dollars. All qualified withdrawals — including growth — are permanently free of federal income tax. Roth accounts are not subject to RMDs during the owner's lifetime, making them the most estate-efficient account type. A well-executed plan steadily shifts the portfolio toward tax-free assets, improving both retirement income flexibility and legacy value.
Withdrawal Sequencing
Strategic Account Draw Order
The deliberate ordering of which accounts to draw from in retirement, and when. A well-structured plan typically follows a taxable-first → tax-deferred → Roth sequence. Drawing from taxable accounts early keeps income low during the Roth conversion window; preserving tax-deferred and Roth assets longer allows them to compound. The sequence is adjusted each year based on bracket headroom, IRMAA thresholds, and Roth conversion targets.
Appendix
The Chens are a fictional couple and all figures are illustrative. Projections are based on the assumptions below and are not guarantees. Actual results will differ. This is not personalized financial, tax, or legal advice. Generated using RightCapital financial planning software.
Disclosure
1 No Warranties.RightCapital makes no warranties, expressed or implied, as to accuracy, completeness, or results obtained from any information on www.rightcapital.com (the "Platform"). The Platform uses simplified assumptions derived and/or obtained from historical data that are used to create assumptions about potential investment returns.
2 Advice.RIGHTCAPITAL DOES NOT PROVIDE LEGAL, TAX, ACCOUNTING, INVESTMENT OR FINANCIAL ADVICE. RIGHTCAPITAL DOES NOT PROVIDE RECOMMENDATIONS FOR ANY PRODUCTS OR SECURITIES. Your financial professional may not provide tax or legal advice. The appropriate professionals should be consulted on all legal and accounting matters prior to or in conjunction with implementation of any strategy. Use prospectus for any discussions about securities.
3 Dataprovided by you or your financial professional for your assets, liabilities, goals, accounts, and other assumptions are key inputs for the calculations at RightCapital. The information should be reviewed periodically and updated whenever there is a change in information or circumstances.
4 Monte Carlo Simulation methodology.RightCapital generated Monte Carlo simulations calculating the results of your plan by running the projection 1000 times. Some sequences of returns will give you better results, and some will give you worse results. These multiple trials provide a range of possible results. RightCapital considers a trial to be "successful" if at the end of the planning horizon your invested assets are greater than zero. The percentage of the trials that were successful is the Probability of Success of your plan, with all its underlying assumptions.
5 Asset classes used in Monte Carlo simulation.RightCapital uses only a few asset classes. The default return and volatility assumptions of the asset classes are estimated based on the historical return data of indices, which serve as proxies for their respective asset classes. They are not returns of actual investments. The historical return data used to derive returns for all asset classes are:
Note: The S&P500 Total Return Index is made up of both large cap growth and large cap value stocks. This index return and volatility data is used for both large cap growth and large cap value asset classes in the RightCapital system as it is an appropriate benchmark for both. RightCapital uses the S&P500 total return index as the best proxy for any unclassified assets labeled as 'Other'.
6 Return and volatility assumptions used in Monte Carlo simulations.
| Asset Class | Total Return | Volatility |
|---|---|---|
| Large Growth | 6.7% | 15.76% |
| Large Value | 6.7% | 15.76% |
| Mid Cap | 7% | 17.12% |
| Small Cap | 6.9% | 19.69% |
| International Equities | 7.8% | 16.55% |
| Emerging Markets | 7.8% | 21.63% |
| Real Estate | 8.2% | 17.24% |
| Government | 4% | 7.38% |
| Municipal | 3.8% | 4.65% |
| Corporate | 5.2% | 4.17% |
| High Yield | 6.1% | 8.89% |
| International Bonds | 4% | 4.17% |
| Cash | 3.1% | 0.54% |
| Other | 6.7% | 15.76% |
7 Tax and Inflation assumptions used in Monte Carlo simulations.Starting federal and state standard deductions, exemptions and the tax brackets used in projections are as of 2026. The following inflation assumptions are used in the projection: General inflation 2.5%; Education inflation 5%; Tax inflation 2.5%; Social Security inflation 2.5%; Health inflation: 5%.
8 Assumption and calculation limitations of Monte Carlo Simulations.
8.1 Your resources and goals may be different from the estimates that you provided. The report is intended to help you in making decisions on your financial future based, in part, on information that you have provided and reviewed including, but not limited to, your age, income, assets, liabilities, anticipated expenses and retirement age. Some of this information may change in unanticipated ways in the future and those changes may make this RightCapital projection less useful.
8.2 Inherent limitations in RightCapital financial model results. Investment outcomes in the real world are the results of a near infinite set of variables, few of which can be accurately anticipated. Any financial model, such as RightCapital, can only consider a small subset of the factors that may affect investment outcomes and the ability to accurately anticipate those few factors is limited. For these reasons, investors should understand that the calculations made in this report are hypothetical, do not reflect actual investment results, and are not guarantees of future results.
8.3 Results may vary with each use and over time. The results presented in this report are not predictions of actual results. Actual results may vary to a material degree due to external factors beyond the scope and control of this report. As investment returns, inflation, taxes, and other economic conditions vary from the assumptions, your actual results will vary from those presented in RightCapital. Small changes in these inputs and assumptions may have a significant impact on the results.
8.4 RightCapital considers investments in only a few Broad Investment Categories. RightCapital utilizes U.S. Large Growth, U.S. Large Value, U.S. Mid Cap, U.S. Small Cap, Real Estate, International Equities, Emerging Markets Equity, U.S. Government, U.S. Corporate, U.S. High Yield, International Bonds and Cash. These broad investment categories are not specific securities, funds, or investment products. The assumed rates of return of these broad categories are based on the returns of indices. These indices do not include fees or operating expenses and are not available for investment. These indices are unmanaged and the returns are shown for illustrative purpose. It is important to note that the broad categories that are used are not comprehensive and other investments that are not considered may have characteristics that are similar or superior to the categories that are used in RightCapital.
8.4.1 Investment Risk. Clients and prospective clients should be prepared to bear investment loss including loss of original principal. Clients should assess their tolerance for risk with their financial professional and update when a change in financial status occurs. Investments are subject to many risks depending on the asset class, including but not limited to: Large Growth, Large Value, Mid Cap, Small Cap, Real Estate: Either the stock market as a whole, or the value of an individual company, may go down, resulting in a decrease in the value of client investments. Common stocks are susceptible to general stock market fluctuations and to volatile increases and decreases in value as market confidence in and perceptions of their issuers change. If you held common stock, or common stock equivalents, of any given issuer, you would generally be exposed to greater risk than if you held preferred stocks and debt obligations of the issuer. Small cap stocks may be subject to risks such as but not limited to volatility, lack of available information and liquidity due to low trading volume. International Equities, Emerging Markets: Foreign investments may carry risks associated with investing outside the United States, such as currency fluctuation, economic or financial instability, lack of timely or reliable financial information or unfavorable political or legal developments. Those risks are increased for investments in emerging markets. Foreign securities can be more volatile than domestic (U.S.) securities. Government, Municipal, Corporate, High Yield, International Bonds: Investments in fixed income are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors. Investing in securities involves risk of loss. Further, depending on the different types of investments there may be varying degrees of risk.
8.5 Insurance, Annuities and other related calculations. RightCapital may include Life insurance, annuity or other products in the calculation. The return or returns of any such life insurance product, annuity or other product, as may be included in the calculation, are hypothetical and shall not be used as proxy, replacement for nor construed as actual performance of the product or to predict or project investment results of those products. Product fees, expenses and detailed features may not be completely included and modeled in the calculation. This report should not be construed as an insurance policy application or pre-qualification.
8.6 Fees and expenses. The portfolio returns assume that the portfolio is rebalanced on an annual basis to reflect the target allocation. No portfolio rebalancing costs are deducted from the portfolio value. Fees and expenses are not included, and thus, are excluded, including, but not limited to, fund fees, account fees, product fees and advisor fee. Inclusion of those fees results in lower returns, which would affect the probability of achieving any particular outcome.
8.7 Taxes. RightCapital includes limited accounting for taxes. RightCapital calculates taxes based on your input. RightCapital estimates federal, state and local taxes based on current laws with simplified deduction, exemption, and tax bracket parameters of the current year. In the projection, tax parameters are adjusted by an inflation assumption provided by you or your financial professional. Future tax laws may be significantly different than current tax laws and may result in higher or lower taxes due than what are reflected within this report. Roth IRA distribution are tax free if made 5 years after the initial contribution to the plan and you are over 59 1/2. Before investing in a 529 plan, consider whether your state offers a 529 plan that provides residents with favorable state tax benefits. RightCapital includes limited accounting for Federal and State Estate Tax with simplified deduction, exemption, and tax bracket parameters of the current year.
8.8 Current Dollars and Future Dollars. The results of RightCapital calculations are in future dollars. To help you compare dollar amounts in different years, results can also be expressed in current dollars by discounting the future dollars by the inflation rate you or your financial professional provides.
8.9 Current allocation and target allocation. Current allocation is the allocation based on the current portfolio holdings entered in the system as well as asset classification data from Morningstar. The target allocation is the allocation recommended by your financial professional.
8.10 Current plan and proposed plan. Current plan is the plan based on the information you and your financial professional input in the profile section. Proposed plan is the plan recommended by your financial professional, with the plan details as shown in the retirement analysis section.
9 Liquidation of holdings.This report may include liquidation of holdings, recommended by your financial professional. The transaction cost of liquidation is not included in the analysis. The liquidation will also result in the loss of future earnings.
Social Security Optimization Strategy
Delay Social Security to maximize lifetime income while the plan uses tax-efficient withdrawals and Roth conversions to bridge the early retirement years.