Many Americans are shocked to see their taxes in retirement are considerably higher than anticipated. The culprit is often called the retirement "tax cliff" -- an unintended result of maximizing tax-deferred accounts that may lead to an abrupt increase later in both income and income taxes.

Since the late 1970s, clients have used tax-deferred plans like 401(k)s and IRAs to save a substantial amount of their wealth for retirement. Early in retirement, many retirees tap taxable accounts for income, allowing their tax-deferred assets to continue to grow.

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