The Power of Zero, Revised and Updated: How to Get to the 0% Tax Bracket and Transform Your Retirement by David McKnight

(New York: Currency, 2014, 2018), 140

  • "The best way to insulate yourself from the impact of rising tax rates is to put yourself in the 0% tax bracket." (81)
  • We have some of the lowest tax rates in history (chart on 10 and 2018 tax chapter on 67).
  • The Taxable Bucket: keep 6 months of living expenses here for liquidity (checking/savings, CD, stocks, bonds, etc.)
  • The Tax-Deferred Bucket: contribute enough to get any employer 401(k) match but not much if any more
    • If taxes are the same, it doesn't matter. But if taxes go up, you would rather pay them now.
  • The Tax-Free Bucket: maximize remaining contributions into the tax-free bucket (Roth IRA and LIRP) to have as much income as possible not taxed in retirement.