The Order You Take Money Out Matters as Much as How Much You Saved
Most retirement planning conversations focus on accumulation — save more, invest consistently, hit the number. What gets far less attention is what happens when you actually start spending it. The sequence of your withdrawals, the timing of a Roth conversion, the year your RMDs kick in — each of these decisions carries a tax consequence. And they interact with each other in ways that can quietly cost you tens of thousands of dollars over a retirement that might last 30 years.
Retirement tax planning is built into every plan we create at Artfx. Not layered on at the end. Not left to your tax preparer to sort out in April. From day one.
Withdrawal Sequencing: Which Accounts Do You Pull From First?
You've probably saved in multiple places — a 401(k), a Roth IRA, maybe a taxable brokerage account. When retirement arrives, the question isn't just how much to take out. It's which bucket you pull from first, and in what proportion.
This is called withdrawal sequencing, and it's one of the highest-leverage decisions in retirement income planning. The conventional wisdom — spend taxable accounts first, tax-deferred accounts second, Roth last — is a reasonable starting point, but it's not a strategy. The right sequence depends on your income sources, your tax bracket in each year of retirement, your Social Security timing, and how your required minimum distributions will eventually affect all of the above.
At Artfx, we map your retirement income across the full horizon — not just year one — so the sequence we build for you is designed to minimize your lifetime tax burden, not just this year's tax bill.
Roth Conversion Planning: Is It Right for You?
Roth conversions aren't for everyone. But for a lot of people in their 40s, 50s, and early 60s — especially those with significant pre-tax retirement savings — they represent one of the most effective tax planning moves available.
The basic idea: you convert a portion of a traditional IRA or 401(k) into a Roth account, pay income tax on the converted amount now, and let that money grow tax-free from that point forward. Future withdrawals are tax-free. And critically, Roth accounts are not subject to required minimum distributions during your lifetime.
The question isn't whether Roth conversions are good in theory. It's whether they make sense for your specific income, your current bracket, your projected RMDs, and your retirement timeline. We do that math — and we do it with your full picture in front of us, not a generic calculator.
RMD Planning: Managing the Distribution You Didn't Choose
Required minimum distributions begin at age 73 under current IRS rules. If you've been diligent about saving in pre-tax accounts — and most people who've had access to a 401(k) have — your RMDs may push you into a higher bracket than you'd otherwise be in. They can trigger taxation of a larger portion of your Social Security income. They can affect your Medicare premiums through IRMAA surcharges. And once they start, you can't opt out.
The time to plan for RMDs is before they begin — ideally a decade before. Roth conversions in the years prior to age 73, strategic charitable giving through qualified charitable distributions, and careful account titling are all tools we use to reduce the RMD burden before it arrives.
We help you see the trap before it springs.
How Social Security Income Affects Your Tax Bracket
Here's something that surprises a lot of people: Social Security benefits are not automatically tax-free. Depending on your combined income — which the IRS calls "provisional income" — up to 85% of your Social Security benefit may be taxable.
The thresholds are relatively low. For a married couple filing jointly, provisional income above $44,000 means 85% of Social Security is subject to federal income tax. That's a number many retirees exceed without realizing it.
This is one reason withdrawal sequencing and Roth conversion planning matter so much. The income you pull from different accounts affects your provisional income calculation, which affects how much of your Social Security gets taxed, which affects your bracket — and so on. These decisions compound. We model them together so you're not making them in isolation.
A Note on How We Think About This
Kirstin spent 25 years managing project-based income as a professional classical singer — contracts that started and stopped, years with multiple income sources, years with gaps. She didn't optimize for a W-2. She learned to think about income as something that moves, and retirement income planning as something that has to flex with it.
That shapes how we approach retirement tax strategy. We're not running a single scenario and calling it a plan. We're building something that accounts for the variability in your life — because retirement rarely arrives exactly as projected.
Common Questions About Retirement Tax Planning
What is the most tax-efficient way to withdraw retirement income?
The most tax-efficient withdrawal sequence depends on your specific accounts, income sources, and bracket situation. A general framework is to draw from taxable accounts first, tax-deferred accounts (like traditional IRAs and 401(k)s) second, and tax-free accounts (Roth) last — but the optimal sequence for your retirement may differ. The goal is to manage your taxable income in each year of retirement to minimize your lifetime tax burden, not just your current-year bill.How do I avoid taxes on retirement withdrawals?
You can't eliminate taxes entirely, but you can reduce them significantly with the right planning. Roth conversions before retirement shift money into tax-free status. Strategic withdrawal sequencing keeps your taxable income in lower brackets. Qualified charitable distributions from an IRA can satisfy RMDs without adding to your taxable income. The earlier you start planning, the more options you have.Should I do a Roth conversion?
It depends on your current tax bracket, your projected RMDs, your retirement timeline, and your income sources in retirement. Roth conversions tend to make the most sense when your current rate is lower than your expected future rate — which is often true in the years between retirement and when RMDs and Social Security begin. We evaluate this as part of every retirement plan we build.How does Social Security income affect my tax bracket?
Social Security benefits become partially taxable once your provisional income — which includes adjusted gross income, non-taxable interest, and half of your Social Security benefit — exceeds certain thresholds. For married couples filing jointly, up to 85% of benefits may be taxable above $44,000 in provisional income. The income you pull from retirement accounts directly affects this calculation, which is one reason withdrawal sequencing matters even before RMDs begin.When should I start planning for RMDs?
Ideally, a decade before they begin — currently age 73 under federal law. The years between retirement and your first RMD are often the best window for Roth conversions, because your taxable income may be lower than it will be once distributions are mandatory. Waiting until RMDs arrive limits your options considerably.What is retirement withdrawal sequencing?
Withdrawal sequencing refers to the order in which you draw from different types of retirement accounts — taxable, tax-deferred, and tax-free. Because each account type is taxed differently, the sequence you choose affects your annual taxable income, your Social Security taxation, your Medicare premiums, and your long-term tax exposure. It's one of the most consequential decisions in retirement income planning, and it's something we build into every plan at Artfx. Every retirement is different. If you're in your 40s or 50s and starting to think seriously about what the tax picture looks like on the other side, the best time to map it out is now — while you still have room to shape it.