Financial Engineer Discusses Ways to Troubleshoot Unnecessary Financial Burdens
Taxes account for the most expensive burden you’ll experience in your lifetime, says engineer-turned-independent financial planning coach Rao K. Garuda.
In addition to federal, state, city and death taxes, there are 59 other varieties. Relatively few taxes, however, account for the bulk of the burden on citizens, says Garuda, whose clients include retirees, people planning for retirement, physicians, business owners and other professionals.
He thinks his fellow Americans deserve a shot at keeping more of their money.
“When I came to the United States, I had less than $10 in my pocket, but I had an excellent education as an engineer. When I married a physician, I realized how expensive it is to make a good living here,” says Garuda, (www.aca-incorp.com), who quickly applied his analytical engineering mind to understanding the complicated tax system.
“Since this country has given me so much, I wanted to repay my fellow Americans with strategies for keeping more of their own money.”
Garuda identifies some of the most expensive and common tax hurdles affecting Americans and offers advice on troubleshooting our tax system.
• Problem: The IRA tax: great on the front end, terrible down the road.
Solution: An IRA is tax-deferred, which means it will accumulate value over time. But when you withdraw from it, you will be heavily penalized with high taxes. That’s why you should convert this asset to a Roth IRA, which allows your money to grow tax-free. Since the money put in was already taxed you don’t have to pay any taxes when you take it out, and, overall, you’ll save a significant amount of money.