Categories: Tax Planning and Strategies
Retirement Income Deferral refers to the strategy of postponing the receipt of retirement income, such as pension payments or distributions from retirement accounts, to a later date.
This deferral can be advantageous as it may enable individuals to reduce their current taxable income, potentially allowing for a lower tax bracket in the year of retirement. Additionally, by delaying withdrawals, the funds may continue to grow tax-deferred, increasing the overall retirement savings available at a future date.
For example, if an employee chooses to defer their pension benefits until age 70 instead of starting at 65, they may receive higher monthly payments due to the extended deferral period.
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