{"id":839,"date":"2007-01-04T08:03:54","date_gmt":"2007-01-04T15:03:54","guid":{"rendered":"http:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/?p=839"},"modified":"2007-01-04T09:44:13","modified_gmt":"2007-01-04T16:44:13","slug":"if-retirements-called-your-golden-years-why-shouldnt-you-keep-the-gold","status":"publish","type":"post","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/839\/if-retirements-called-your-golden-years-why-shouldnt-you-keep-the-gold\/","title":{"rendered":"If Retirement’s Called Your ‘Golden Years’ Why Shouldn’t You Keep The Gold?"},"content":{"rendered":"

If you’re in the state\/fed combined tax bracket of 33.3% and your home mortgage is interest only at 6%, your after tax rate is 4%. But you knew that, right? And if your loan is say, $200K, then your annual interest deduction is $12k. At your 1\/3 tax bracket your actual interest paid is only $8K. This means you are not paying $4k in income taxes just because you own your home. Big deal you say, everyone knows that. True enough. But is there a way to take further advantage of that tax break?<\/p>\n

What if you’re married and you’ve been putting $4k annually in your 401k. Why do people do this? They do it because they’ve been pounded since they can remember — “you’re saving taxes on every buck you put into your 401k. Don’t be an foolish, keep doing it.” What if you took the $4k in tax savings from your home interest deduction and put it into something that might grow tax free? Why would you insist on taking an additional<\/em> $4k and locking it inside a retirement plan that’s telling you up front it’s going to tax everything that comes out in retirement income? <\/em>And that tax rate will probably be the same or more than what you’re paying now. And we’ll tax your heirs when both of you are gone.
\n<\/strong><\/p>\n

\"Golden<\/p>\n

“But my retirement tax bracket will be significantly lower than it is now” you reply confidently. Not so fast. Aren’t you and your wife doing your best to end up with a free and clear castle by the time you pick up your gold watch? If you guys put the same $4k in the retirement plan (401k\/IRA) every year for 35 years and it grows at an average rate of 8%, you’ll have around $690K. At that same 8% you’ll have an annual income to add to your Social Security check (laughing in backround) of roughly $51,750 — pretty nice, eh? Not so fast. You’re earning too much possibly. What? Social Security may become taxable with your increased income. In any case, your retirement income is about what Read more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

If you’re in the state\/fed combined tax bracket of 33.3% and your home mortgage is interest only at 6%, your after tax rate is 4%. But you knew that, right? And if your loan is say, $200K, then your annual interest deduction is $12k. At your 1\/3 tax bracket your actual interest paid is only […]<\/p>\n","protected":false},"author":8,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,6,5],"tags":[],"class_list":{"0":"post-839","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"hentry","6":"category-investment","7":"category-marketing","8":"category-real-estate","10":"no-featured-image"},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":1479,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/1479\/401ks-iras-urban-myths\/","url_meta":{"origin":839,"position":0},"title":"401(k)’s IRA’s & Urban Myths","author":"Jeff Brown","date":"May 29, 2007","format":false,"excerpt":"In a recent post, Retirement -- A New Class Being Created, I predicted a new class of retiree living a life tied to their free and clear home, with little monthly income. It inspired some interesting comments, and a question that is the inspiration for this post. One reader, Eric,\u2026","rel":"","context":"In "Investment"","block_context":{"text":"Investment","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/investment\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":902,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/902\/compounding-return-on-investment-what-matters-to-investors-invest-1-get-2-back\/","url_meta":{"origin":839,"position":1},"title":"Compounding, Return On Investment, & What Matters To Investors — Invest $1 Get $2 Back","author":"Jeff Brown","date":"January 16, 2007","format":false,"excerpt":"The miracle of compounding is what it's called. The ability to earn interest on interest is the simplest way to put it. Start out with a hundred bucks at 8% annually and beginning the second year you're earning 8% on $108. Keep that up for about nine years and you\u2026","rel":"","context":"In "Investment"","block_context":{"text":"Investment","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/investment\/"},"img":{"alt_text":"Compound interest","src":"https:\/\/i0.wp.com\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-content\/uploads\/2007\/01\/einstein-compound-interest.gif?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":750,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/750\/retirement-lifestyle-3-quick-peeks-into-your-future\/","url_meta":{"origin":839,"position":2},"title":"Retirement Lifestyle: 3 Quick Peeks Into Your Future","author":"Jeff Brown","date":"December 8, 2006","format":false,"excerpt":"I just got off the phone with a delightful lady, who has been assigned the impossible task of editing my blog. She's now reviewing what I've done so far, and her preliminary opinion is that I'm not inarticulate. I'll await her final call with as little anxiety as possible. She\u2026","rel":"","context":"In "Investment"","block_context":{"text":"Investment","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/investment\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":10732,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/10732\/appreciation-is-a-luxury-invest-accordingly\/","url_meta":{"origin":839,"position":3},"title":"Appreciation Is A Luxury – Invest Accordingly","author":"Jeff Brown","date":"December 29, 2009","format":false,"excerpt":"Here's an example, using real properties recently purchased by real clients. I'm gonna modify some of the numbers, but the modifications will not in any way make the bottom line better by an inch. (Worse in fact.) What if you paid $245,000 apiece for four properties, each with an annual\u2026","rel":"","context":"In "Investment"","block_context":{"text":"Investment","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/investment\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":7171,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/7171\/what-if-they-reduced-a-tax-deduction-hardly-anybody-gets-if-youre-the-fib-spinning-pinocchio-at-the-national-association-of-realtors-your-whole-make-believe-world-just-collapsed\/","url_meta":{"origin":839,"position":4},"title":"What if they reduced a tax deduction hardly anybody gets? If you\u2019re the the National Association of Realtors and you’ve been spinning lies for decades about mortgage interest deductibility, your whole make-believe world just collapsed\u2026","author":"Greg Swann","date":"June 9, 2010","format":false,"excerpt":"Kicking this back to the top. It's news again. I wrote this post more than a year ago, but, per The Hill, the tax-deductibility of mortgage interest is back on the table:The popular tax break for mortgage interest, once considered untouchable, is falling under the scrutiny of policymakers and economic\u2026","rel":"","context":"In "Big Mother"","block_context":{"text":"Big Mother","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/big-mother\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":5564,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/5564\/think-your-taxes-are-going-down-think-again\/","url_meta":{"origin":839,"position":5},"title":"Think Your Taxes Are Going Down? Think Again","author":"Doug Quance","date":"November 13, 2008","format":false,"excerpt":"In A Few Years We'll Be Calling These Days The Good Ol' Days Some believe that in the coming administration, their taxes will be lowered. Some even believe that they won't have to worry about buying gas... or paying their mortgage... as Obama will make sure that all is well.\u2026","rel":"","context":"In "General"","block_context":{"text":"General","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/general\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"_links":{"self":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/839","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/comments?post=839"}],"version-history":[{"count":0,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/839\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/media?parent=839"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/categories?post=839"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/tags?post=839"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}