if i start to save up at age 25 and retire at age 65, what will be the best tax bracket to be in and why??what will be the worst tax bracket to be in and why??
You don't really get a choice on your tax bracket. If your Adjusted Gross Income (AGI) is higher, you are going to be paying a higher tax rate. The good thing about 401Ks and 403Bs, is that you can defer your tax until after you retire. So if you are 25 years old, and make 100,000, but you put 10,000 into a 401K, you would only have to tell the government that you made 90,000. Infact, your W2 would say 90,000. At this level you probably paying about 20% tax if you are single. If you do that for 40 years, when you are 65, you will have 400,000 in the bank, plus interest, so it will be closer to 800,000. If you took that 800,000 out all at once you would pay 43% tax on it. but, if you took, say 40K out per year, over 20 years, you would only pay about 10% tax on it. If yo
The best would be the highest bracket, because it would mean that you would have a very large amount of income. The worst would be the lowest bracket, because it would mean that you had very little income.
