ACA
Arcosa, Inc. Common Stock
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Don’t listen to those telling you to max your 401k and ignore taxable accounts. There are many reasons to build a mix of traditional, Roth, and taxable accounts. There are literally millions of seniors facing massive RMDs because they listened to those pushing maxing their 401k, because the market has outperformed over the last 15 years, and because they have exceeded their own saving goals. There are about 350,000 Americans hitting 65 EVERY MONTH and many are running into this issue. They are forced to take remedial action to lower their traditional 401k/IRA balance by withdrawing more than they want to before the government does it for them with RMDs.
As a result many are paying taxes at a higher rate than they expected in retirement because they’re withdrawing more than they need from their 401k, in some cases on top of pensions or social security. And when one spouse passes and the remaining spouse inherits their 401k or IRA the problem really compounds as the remain spouse tax brackets shrink to a single filer. So the end result is they pay higher taxes that they would have had they spread their savings across 3 accounts. 401k, Roth, taxable.
They were told by the same people who told them to max their 401k that it was smart because they’d be in a lower tax bracket in retirement. That was clearly poor advice on top of poor advice. It makes no sense to set yourself up to have to take extraordinary steps later in life when you can set up your retirement savings in 3 buckets that can each be left to grow. This will allow you to select which bucket you withdraw from and when you do it. People who max their 401ks have less options to maximize their spendable income.
So for example if you want to minimize your taxable income because you want to pay less tax or you want your MAGI (income) to be under a certain amount to qualify for government programs like ACA credits or to avoid IRMAA fees on Medicare you need a taxable account. The only other source would be a Roth and that’s not a good choice because you want to leave that alone for as long as possible to grow.
A taxable account also allows you to live tax free up to the tune of $98,900 income from long term cap gains and qualified dividends as a married filing jointly tax payer. That’s on top of your standard deduction. That’s a total of about $147,000 at 0% Federal tax rate for a married couple 65+. People with only 401k savings don’t have that option. A Taxable account also allows for tax loss harvesting and tax gain harvesting. That means you get to use your losses on a bad year to pay zero tax on a good year. It also lets you increase your cost basis to pay less tax on future cap gains. Again. Not possible within a 401k.
Finally we can all only guess what taxes will do in the future but chances are the tax brackets are only going up. We’re in one of the lowest tax periods in the last 100 years. So it makes sense to pay taxes now on a portion of your savings so that whatever happens in the future you made the right call with some of your savings. So get your taxable account going and start investing. You won’t regret it.

for healthcare, 100%
I know FIRE folks who utilize the ACA route, but affordable housing in some of our cities is a little different. They're strict about yearly taxable income, and they want documentation of assets. My index funds are in a retirement account, with 100% of my AMD gains in my taxable account lol. I really can't complain I've been holding this money printer for a decade, but just some things I never thought about when I started.

How much is in the IRA relative to three times the amount you'll need to withdraw every year? That's the amount that should be in cash, just what you actually plan to withdraw. You don't need to only spend dividends/interest. Moving everything to cash just to only spend interest (and then move it back?) is not a good idea long term, and it's not necessary.
I know there are a lot of funds and strategies around creating "income" but just investing normally (mostly as you did during accumulation, just a bit more conservative) and selling shares is fine. Money you need soon should be in shorter term bond funds ("cash") so you're not forced to sell stocks low. Likewise, medium term money should be in bonds or bond funds with longer duration appropriate to when you'll need the money. But there's nothing bad about selling shares in general. It's not true that only spending dividends is any safer.
I'm assuming it needs to be tax free for ACA or similar such purposes? Usually withdrawing from the Roth (if you also have traditional/taxable) should come last, but everyone's situation is different so that's not universally true.

Literally: Will your tax rate be lower in retirement or now?
If retirement: put it in traditional 401k
If now: put it in Roth 401k
I did a ton of math once and realized this was pretty much all it is.
There is still nuance with ACA subsidies and taxable amount in retirement but this is really all.

Do i do roth conversions now? What about ACA subsidies? Bond tent? How much cash cushion? Hold gold to potentially increase SWR?
I do plan to pay for a financial plan and have follow up visits

**Some General Guidelines**
\- Withdrawal strategies - **4%**
\- sequence of returns risk - **Buffer Assets**
\- when to take social security - **When you need the money**
\- health care before Medicare **COBRA, Employer Retiree Plan, ACA, Roll the dice**
\- Medicare Advantage vs Supplemental Plans **travel often Supplemental; little to zero travel Advantage**
\- Roth Conversions **up to 22% as insurance against Widow's Tax/RMD (*****men still usually die first*****)**
\- IRMAA **Keep below thresholds including conversions**
\- RMDs **See Roth Conversions above**
\- Estate Planning **sell it all,** **Die with Zero**

SPYI generates ROC dividend which means no taxes for about 9 years. After that it is qualified dividends.
GPIX also generates ROC dividend but lower yeild so it ia tax free for about 10 years. And after that it is qualified.
The no tax period of these fund means during that time your taxable income is much lower than your actual income so you get more ACA subsidies .this is assuming we have any ACA in the next 2 years. if DJT has his way there may not be any ACA next year.

healthcare stocks sold off after CMS moved to cancel ACA coverage for roughly 760,000 people. Tandem has little direct exposure to that

What are you doing for health insurance? 80k in taxable income is right on the edge of dusqualifying uou for ACA subsidies

I love when people say this bs “not a fan of dems” like passing of ACA, Dodd Frank reform, IRA for clean energy and climate change, same sex marriage, chips act, infra and jobs act isn’t really a big deal for America. What has the other side done for the country? Lmaooooooooo

I’m going to respectfully disagree with your statement that withdrawls from Taxable, Traditional, Roth should always be in that order. For example when you want to use up your standard deduction before social security or a pension kicks in then you withdraw first and potentially exclusively for that year from traditional. Likewise if you want to fill the 10% bracket it comes from traditional. Same applies if you want to spend down your traditional to minimize RMDs.
You need to retain the taxable for when you want to reduce your AGI to qualify for ACA subsidies or to avoid IRMAA or get benefits dependent on AGI or after you’ve filled your standard deduction with traditional and need funds but want to pay no more tax. The whole point of the 3 buckets is to be able to change the sequence to suit the circumstances. It’s not “always” one sequence.

As in most things a balanced approach is generally the best option. That means a mix of pre-tax 401k, post-tax Roth IRA, and taxable cash accounts. One can debate the proportions of each bucket but there is little doubt that having an amount in each provides the most options when one starts withdrawing funds.
This is important as there are variables that will only become apparent when we retire and start withdrawing. Variables such as the tax brackets in effect in 30 years, the standard deduction and any extra deductions that one may be eligible for in 30 years, how much ones retirement has grown, the status of IRMAA, the status of the ACA, age at retirement, ones spending needs, married or single filing status, etc etc.
Because of these unknowns having several buckets will allow you to sequence your withdrawls in such a way as to minimize your taxes and leverage subsidies you may qualify for that are based on gross income. The desired outcome is maximizing spendable income for you and your heirs.

What is your marginal tax rate now?
What do you expect your marginal tax rate to be in retirement?
Lets say its 22% now. In retirement you want to pull at least enough to fill the 12% bracket. (one possible exception would be ACA subsidies).
Since we don't know the future, a mix of both is usually better than going all in either way.

Yeah, covered call funds do reduce portfolio risk (like bonds do), so the numbers may look different if you look at risk-adjusted returns instead of overall total returns. And the distributions are mainly RoC, which doesn't count towards MAGI if you're having to strictly monitor that for ACA subsidies. So there is some utility to these funds, but you are sacrificing those total returns for those benefits.
The one thing I'd warn about relying on covered call funds in retirement is that the income is going to be NAV-based. Funds like SPYI make it obvious as they state their aim is to pay out 1% of NAV per month, but all covered call funds pay more when NAV increases and pay less when NAV decreases. So if the market suddenly drops 40%, your income from these funds will likely look the same.
But if you have bonds, which also supply income, and can be sold to supplement income during an equities crash, then that setup is likely fine.