This "book" is the most intellectually dishonest piece of shill for the insurance agencies I've ever seen and hope never to see again.
I have sci-fi books that have more intellectual rigor that this slop. Tax Free Retirement by Patrick Kelly (2017
I've been irritating my wife by reading this in bed and going all !#$@#%!% over it.
I wanted to post about it but NOT in the book club threads. I certainly would not want it to be thought that I had any good thoughts about this "book".
Example1 page 120 (10th anniversary edition):
"The current (2017) capital gains rate on long term holdings can range between 15% and 28% ..."
vs the easily looked-up truth.......
Marginal Tax Rate (Tax Bracket) Long-Term Capital Gains Tax Rate
10% 0%
15% 0%
25% 15%
28% 15%
33% 15%
35% 15%
39.6% 20%
Data source: IRS. via
https://www.fool.com/retirement/2016/12/11/long-term-capital-gains-tax-rates-in-2017.aspxExample 2 pg 105 in
BOLD about inherited IRA's
....
the money gets treated as taxable income earned in that year by the receiving heir and gets taxed at the appropriate tax rate the 2017 tax bracket table is just above.
vs
"Non-spouse beneficiaries are subject to required minimum distributions and may not treat an inherited IRA as their own. That is, they may not make additional contributions or roll over assets into or out of the inherited IRA. Taxes are not due until distributions are received." ---https://www.investopedia.com/terms/i/inherited_ira.asp
It is not that this is just wrong, this is the second (10th anniversary edition) and it is actively misleading. Aaaaaarrgggg!
pg 80-81
retirement account
$100/month x30 years =36,000 contribution and future value $121,997 -- agree there.
"lets be generous and assume the same low net tax rate of 20%"
net tax rate is not defined, I'm assuming it is effective tax rate (tax/gross income), from
https://engaging-data.com/tax-brackets/ an "average" tax rate means gross is ~200,000/year for single filer.
Which is greater than the whole of the account.
"If we apply that tax rate to the total balance of the tax-qualified plan you get a whopping tax liability of $24,399" ...... So much for the $7,200 tax deferral (of the 36,000 contribution)."
at first I though this was the personal deduction, but it is the deferral, so OK it's true, but only for wildly exaggerated spend rates in retirement.
At an RMD spend rate (~6K/yr), you could hide the whole thing behind a standard deduction.
Edited to add stuff
