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Donna Fuscaldo is a contributing writer and editor focusing on personal finance and health. She has spent over two decades writing and covering news for several national outlets, including The Wall Street Journal, Forbes, Investopedia and HerMoney.​

Lynn Asinof is a personal finance journalist who spent 20 years at The Wall Street Journal and has written for Money, Fortune and The Boston Globe.

Ellen Stark, a former deputy editor of Money, has covered personal finance for more than 20 years.

Beth Braverman is a contributing writer who has covered shopping and personal finance for more than a decade. Her work has appeared in Consumer Reports, CNNMoney.com, CNBC.com and dozens of other publications.

Andy Markowitz is a contributing writer and editor for AARP, covering Social Security and fraud. He is a former editor of The Prague Post and Baltimore City Paper.

Adam Shell is a freelance journalist whose career spans work as a financial market reporter at USA Today and Investor’s Business Daily and an associate editor and writer at Kiplinger’s Personal Finance magazine. 

Ronda Kaysen is a freelance journalist and New York Times contributor who reports on housing and real estate.

Chris Taylor is senior correspondent with Reuters, covering personal finance and workplace issues. He is a frequent contributor to Fortune Magazine, and has won journalism awards from the National Press Club, the Deadline Club, and the National Association of Real Estate Editors.

Stacey Freed is a contributing writer who covers remodeling, construction, lifestyle issues, education and pets. Her work has appeared in Beautiful Kitchens & Baths and This Old House on Forbes.com.

Allan Roth is a practicing financial planner who has taught finance and behavioral finance at three universities and has written for national publications including The Wall Street Journal. Despite his many credentials (CFP, CPA, MBA), he remains confident that he can still keep investing simple.

Patrick J. Kiger is a contributing writer for AARP. He has written for a wide variety of publications, including the Los Angeles Times Magazine, GQ and Moth.

Patricia Amend has been a lifestyle writer and editor for 30 years. She was a staff writer at Inc. magazine; a reporter at the Fidelity Publishing Group; and a senior editor at Published Image, a financial education company that was acquired by Standard & Poor’s.

Lisa Lee Freeman, a consumer and shopping expert, was founder and editor in chief of ShopSmart magazine from Consumer Reports.

Lexi Pandell has written about technology for Wired, The New York Times and The Atlantic, among other media outlets.

John Waggoner covers all things financial for AARP, from budgeting and taxes to retirement planning and Social Security. Previously he was a reporter for Kiplinger's Personal Finance and USA Today and has written books on investing and the 2008 financial crisis. Waggoner's USA Today investing column ran in dozens of newspapers for 25 years.

Bruce Horovitz is a contributing writer who covers personal finance and caregiving. He previously wrote for The Los Angeles Times and USA TODAY. Horovitz regularly writes for The New York Times, the Wall Street Journal, The Washington Post, Investor's Business Daily, AARP Magazine, AARP Bulletin, Kaiser Health News, and PBS Next Avenue.

Kimberly Lankford has been a financial journalist for more than 20 years. She was the “Ask Kim” columnist at Kiplinger's Personal Finance, and her articles have also appeared in AARP The Magazine, U.S. News & World Report, The Washington Post, The Boston Globe and other publications. She received the personal finance Best in Business award from the Society of American Business Editors and Writers, and she has written three books.

Ed Slott, CPA, is one of the nation’s top experts on retirement plans. For more than 30 years, he has educated both consumers and financial advisers on retirement tax-saving strategies. His most recent book is The New Retirement Savings Time Bomb (Penguin Random House, 2021). Visit www.IRAHelp.com to learn more.

Karen Cheney is a veteran personal finance journalist whose work has appeared in Money, Real Simple and other publications.

Jean Chatzky is an award-winning personal finance journalist and best-selling author of  books including Women with Money: The Judgment-Free Guide to Creating the Joyful, Less Stressed, Purposeful (and Yes, Rich) Life You Deserve. 

Linda Stern, former Wall Street editor for Reuters, has been covering personal finance since the 1980s.

Kenneth Terrell covers employment, age discrimination, work and jobs, careers, and Congress for AARP. He previously worked for the Education Writers Association and U.S. News & World Report, where he reported on government and politics, business, education, science and technology, and lifestyle news.

Sharon Jayson is a contributing writer who covers health care and aging. She previously worked for USA Today and the Austin (Texas) American-Statesman and her work also has appeared in The Washington Post, Time magazine and Kaiser Health News.

Tamara E. Holmes is a Washington, DC-based writer and editor. She has written extensively about money, entrepreneurship and careers for more than two decades. Her work has appeared in such publications as USA Today, Working Mother and Essence.

John Waggoner covers all things financial for AARP, from budgeting and taxes to retirement planning and Social Security. Previously he was a reporter for Kiplinger's Personal Finance and  USA Today and has written books on investing and the 2008 financial crisis. Waggoner's  USA Today investing column ran in dozens of newspapers for 25 years.

Gwen Moran is a contributing writer for AARP who specializes in business and finance. Her work has appeared in many leading business publications and websites, including Entrepreneur, Kiplinger.com, Newsweek.com, and The Los Angeles Times Magazine.

Beth Braverman is an award-winning personal finance writer who has written for Consumer Reports, Money and CNBC.com.

Lexi Pandell has written about technology for Wired, The New York Times  and The Atlantic, among other media outlets.

Sharon Waters, a former CPA, has written for Wired.com and other publications.

Kim Porter has written for U.S. News & World Report, Time’s NextAdvisor and other media outlets.​​

Testing Page - Switching Banks

use for test building

Illinois charges all filers, no matter the size of their income, the same 4.95 percent tax rate, after exemptions and credits. 

Because of the state’s 13.3 percent tax bracket for its highest earners, California has a high-tax reputation. But taxes for middle-income people are lower, says Carl Davis, research director for the Institute on Taxation and Economic Policy. 

“Florida and Texas get held up as low-tax states,” Davis notes. “That’s pretty much always true at the very top. It’s often not true for lower-income families. And in the middle, it’s complicated.” 

States with a full sales tax on groceries ​(*may offer rebates and credits to low-income, disabled or older residents​)

  • Alabama​
  • Hawaii*​
  • Idaho*​
  • Kansas*​
  • Mississippi​
  • Oklahoma*​
  • South Dakota*​

IRS Tax Deadlines 2022

Jan. 18 Final estimated tax payment for 2021 due

Jan. 24 IRS Free File service opens to prepare tax year 2021 returns

Jan. 24 Free MilTax service for military opens to prepare 2021 returns

April 18 First estimated tax payment for tax year 2022 due

April 18 Filing deadline for tax year 2021.

June 15 Second estimated tax payment for 2022 due

Sept. 15 Third estimated tax payment for 2022 due

Oct. 15 Extended deadline to file 2021 tax return

— 

Jan. 15, 2023 Fourth estimated tax payment for 2022 due

 

Calculator Definitions

The amount you will contribute to your Traditional IRA each year. This calculator assumes that you make your contribution at the beginning of each year. From 2008 through 2010, the maximum annual IRA contribution is $5,000 per individual. It is important to note that this is the maximum total contributed to all of your IRA accounts. The contribution limit increases with inflation in $500 increments. An annual change to the contribution limit only occurs if the cumulative effect of inflation since the last adjustment is $500 or more.If you are 50 or older you can make an additional "catch-up" contribution of $1,000. The "catch-up" contribution amount of $1,000 remains unchanged for 2010. In order to qualify for the "catch-up" contribution, you must turn 50 by the end of the year in which you are making the contribution.

The annual rate of return for your IRA. This calculator assumes that your return is compounded annually and your contributions are made at the beginning of each year. The actual rate of return is largely dependent on the type of investments you select. For example, from December 1999 to December 2009, the average annual compounded rate of return for the S&P 500 was -0.6%, including reinvestment of dividends. From January 1970 to December 2009, the average annual compounded rate of return for the S&P 500, including reinvestment of dividends, was approximately 10.1% (source: www.standardandpoors.com). Since 1970, the highest 12-month return was 61% (June 1982 through June 1983). The lowest 12-month return was -43% (March 2008 to March 2009). Savings accounts at a bank may pay as little as 1% or less but carry significantly lower risk of loss of principal balances.It is important to remember that these scenarios are hypothetical and that future rates of return can't be predicted with certainty and that investments that pay higher rates of return are generally subject to higher risk and volatility. The actual rate of return on investments can vary widely over time, especially for long-term investments. This includes the potential loss of principal on your investment. It is not possible to invest directly in an index and the compounded rate of return noted above does not reflect sales charges and other fees that funds and/or investment companies may charge.

Your current age.

Age you wish to retire. This calculator assumes that the year you retire, you do not make any contributions to your IRA. So if you retire at age 65, your last contribution happened when you were actually age 64.

Your current marginal tax rate you expect to pay on your taxable investments.

The marginal tax rate you expect to pay on your investments at retirement.

What you anticipate your income to be. This is used to calculate whether you are able to deduct your annual contributions from your taxes. It is important to note that there are no income limits preventing you from contributing to a Traditional IRA. Annual income only affects your ability to make a tax deductible contribution.

Check the box if you are married. This is used to determine whether you can deduct your annual contributions from your taxes.

Check the box if you have an employer sponsored retirement plan, such as a 401(k) or pension. This is used to determine if you can deduct your annual contributions from your taxes. For more information on how an employer plan can affect your IRA tax deduction, see the definition for non-deductible contributions, directly below.

The total of your Traditional IRA contributions that were deposited without a tax deduction. Traditional IRA contributions are normally tax-deductible. However, if you have an employer sponsored retirement plan, such as a 401(k), your tax deduction may be limited.

In 2010, for single tax filers with an employer sponsored retirement plan, an IRA contribution is fully tax-deductible if your income is below $56,000. It is then prorated between $56,000 and $66,000. If your income is over $66,000 and you have an employer sponsored retirement plan, such as a 401(k), you receive no tax deduction. For married couples, the same rules apply except the deduction is phased out between $89,000 and $109,000.

This calculator automatically determines if your tax deduction is limited by your income. However, there are two unusual situations not automatically accounted for where additional tax phase-outs are applied. First, if your spouse has an employer sponsored retirement plan but you do not, your tax deduction is phased out from $167,000 to $177,000. Second, if you are married filing separately and have an employer sponsored retirement plan, the income phase-out is from $0 to $10,000.

The total amount contributed to this IRA.

Total value of your IRA at retirement before taxes.

Total value of your IRA at retirement after taxes are paid.

Total value of your savings, at retirement, if the after tax contribution amount is deposited into a taxable account. This value, which we call your "Taxable Account Deposit" is calculated by assuming you could save an amount equal to the after tax cost of contributing to a Traditional IRA. Your "Taxable Account Deposit" then is equal to your Traditional IRA contribution minus any tax savings. For example, assume you have a 30% combined state and federal tax rate. If you contribute $2000 to a Traditional IRA and qualify for the full $2000 tax deduction, the value of your tax deduction is $2000 X 30% or $600. The after tax cost of contributing to your Traditional IRA would then be $2000 minus $600 or $1400. If you do not qualify for tax deductible Traditional IRA contributions, your "Taxable Account Deposit" will be the same as your Traditional IRA contribution.In addition, all earnings in your taxable account are assumed to be taxable in the year they are earned.

Roth IRAs — 2020 vs. 2019 deduction limits

Filing status

2020 MAGI

2021 MAGI

Contribution

Single or head of household

<$124,000

<$125,000

Full contribution

 

>$124,000 and <$139,000

>$125,000 and
<$140,000

Partial contribution

 

>$139,000

>$140,000

No contribution

Married filing jointly or qualified widow(er)

<$196,000

<$198,000

Full contribution

 

>$196,000 and <$206,000

>$198,000
<$208,000

Partial contribution

 

>$206,000

>$208,000

No contribution

Married filing separately

<$10,000

<$10,000

Partial contribution

 

>$10,000

>$10,000

No contribution

Roth IRAs — 2020 vs. 2019 deduction limits

Filing status

2020 MAGI

2021 MAGI

Contribution

Single or head of household

<$124,000

<$125,000

Full contribution

 

>$124,000 and <$139,000

>$125,000 and
<$140,000

Partial contribution

 

>$139,000

>$140,000

No contribution

Married filing jointly or qualified widow(er)

<$196,000

<$198,000

Full contribution

 

>$196,000 and <$206,000

>$198,000
<$208,000

Partial contribution

 

>$206,000

>$208,000

No contribution

Married filing separately

<$10,000

<$10,000

Partial contribution

 

>$10,000

>$10,000

No contribution

sector example 3

1980

1. IBM

2. AT&T

3. Exxon

4. Standard Oil of Indiana

5. Schlumberger

6. Shell Oil 

7. Mobil

8.  Standard Oil of CA

9. Atlantic Richfield

10. GE

2020

1. Apple

2. Microsoft

3. Amazon

4. Alphabet

5 Facebook

6. Berkshire Hathaway

7. Walmart

8.  Tesla

9. Visa, Inc.

10. Johnson & Johnson

The U.S. stock market is in a super bubble.

Interest rates will definitely continue to rise, crushing bond prices.

Sell, sell, sell these two stocks immediately.

Gold will surge.

Bitcoin will surpass $200,000.

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https://www.youtube.com/embed/9YLXEhSjVsw

Free Planning Tool

AARP Money Map is a guide to manage unanticipated expenses

Free Planning Tool

AARP Money Map is a guide to manage unanticipated expenses

Lori Gannon, 68

Gaylord, Michigan — 7-year volunteer

 

"I did my mother's taxes, and when I moved farther away, she tried to do them herself and was simply overwhelmed. I'm glad to be able to ease that stress for others."

"I did my mother's taxes, and when I moved farther away, she tried to do them herself and was simply overwhelmed. I'm glad to be able to ease that stress for others."

Coronavirus Stimulus Payment Calculator

Estimate your stimulus check from the second round of federal coronavirus relief

COVID-19 pandemic

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telehealth

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questions to ask assisted living

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group home alternative

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Also of Interest

Also of Interest

Also of Interest

AARP Membership -Join AARP for just $9 per year when you sign up for a 5-year term

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Also of interest

How to start saving for retirement with just $50 and an IRA

aarp.org/money/investing/info-2020/why-use-iras-for-nest-egg.html?intcmp=MON-FEED

8 Ways to rescue your retirement portfolio

aarp.org/retirement/retirement-savings/info-2020/8-ways-to-rescue-nest-eggs.html

Is it worth a risk to get more income from retirement savings?

aarp.org/money/investing/info-2019/low-interest-rates-versus-market-risks.html

 

Investing to Create Retirement Income Can Be Dangerous

https://www.aarp.org/money/investing/info-2020/retirement-income-risks.html

How to Start Saving for Retirement With Just $50 and an IRA

https://www.aarp.org/money/investing/info-2020/why-use-iras-for-nest-egg.html

10 Stocks Raising Dividends for 50 Years in a Row

https://www.aarp.org/money/investing/info-2020/10-dividend-king-stocks.html

https://www.aarp.org/content/dam/aarp/politics/advocacy/2020/08/letter-to-potus-on-soc-sec-payroll-tax-081320.pdf

Also of Interest

Q: I took my 2020 required minimum distribution (RMD) back in January before the law changed, allowing 2020 RMDs to be waived. Can I return those funds and eliminate the tax?

— J.W.

Bonus Q: If you paid taxes on your RMD, do you get them back?

— M.D.

Ask Ed Slott

Confused about IRAs, 401(k)s, Roths, taxes and more related to saving for retirement? Ed has the answers. Email your questions to IRAHelp@aarp.org.

Ask Ed Slott

Confused about IRAs, 401(k)s, Roths, taxes and more related to saving for retirement? Ed has the answers. Email your questions to IRAQuestions@aarp.org.

Answer:

It's good you are looking to get professional advice on this, because there are several factors you need to consider: mainly income and taxes in your retirement years. As a CPA and retirement tax adviser, I did exactly this type of planning for many years, so I know what's involved here and am happy to offer my assistance to you.

Ed Slott, CPA, is a nationally recognized IRA expert, public television personality, author and media resource who has dedicated his life to educating Americans (and their financial professionals) on protecting retirement accounts from unnecessary taxes. His most recent book is The New Retirement Savings Time Bomb (Penguin Random House, 2021), Visit IRAHelp.com to learn more.

Ed Slott, CPA, is one of the nation's top experts on retirement plans. For more than 30 years, he has educated both consumers and financial advisors on retirement tax-saving strategies. Most recently, he published Ed Slott's Retirement Decisions Guide: 2020 Edition and is the host of several popular public television specials, including his latest, Retire Safe & Secure! With Ed Slott. Visit www.IRAHelp.com to learn more.

illustration of keith gumbinger

— Keith Gumbinger, online mortgage wizard and vice president of HSH.com

62. Retire Mortgage Free

With 15 years left on a 5 percent 30-year mortgage of $100,000, you can retire the loan in seven years by prepaying $442.63 a month. Do that and you'll save $16,035 in interest.

63. Use Adjustables

Adjustable-rate mortgages aren't always a good idea. But refinance with a hybrid ARM and save if you plan to sell in a given time frame. A five-year fixed-rate loan may be available for 3 percent.


Updated February, 2020

More on Social Security Benefits

For ways to save and more, get AARP’s monthly Money newsletter.


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Years

64
64
63
63
62
58
58
57
52
51

64 Years 

Genuine Parts Company 

63 Years   

Emerson Electric Co.

63 Years

Procter & Gamble Company 

62 Years

3M Company 

58 Years

Johnson & Johnsonn 

58 Years

Coca-Cola Company 

57 Years

Colgate-Palmolive Company 

52 Years

Stanley Black & Decker, Inc

51 Years

Hormel Foods Corporation 

(Company logos,  Alamy Stock Photos)

AARP Membership -Join AARP for just $9 per year when you sign up for a 5-year term

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S&P 500 Index 10 Top Performers 1/1 - 12/1/2020

Source: S&P Capital IQ Equity Screening Report

Company name (Ticker)

Etsy, Inc. (NasdaqGS:ETSY)

NVIDIA Corporation (NasdaqGS:NVDA)

L Brands, Inc. (NYSE:LB)

Advanced Micro Devices, Inc. (NasdaqGS:AMD)

PayPal Holdings, Inc. (NasdaqGS:PYPL)

FedEx Corporation (NYSE:FDX )

ServiceNow, Inc. (NYSE:NOW)

Albemarle Corporation (NYSE:ALB)

West Pharmaceutical Services, Inc. (NYSE:WST)

Freeport-McMoRan Inc. (NYSE:FCX)

% change

 249.1 

 127.9 

 117.3 

 102.0 

 100.2 

 92.7 

 91.1 

 88.7 

 81.5 

 80.9 

Company

Dover Corporation
Genuine Parts Company
Emerson Electric Co.
Procter & Gamble Company
3M Company
Johnson & Johnson
Coca-Cola Company
Colgate-Palmolive Company
Stanley Black & Decker, Inc.
Hormel Foods Corporation

Years

64
64
63
63
62
58
58
57
52
51

Why Dividends Matter

12 Dividend Stocks

5 Bond Funds

Editor’s Note: This article was originally published on February 28, 2020. It has been updated to reflect recent information.