Do you have an IRA or 401(k)? You may be getting yourself trapped.

Most Americans who are concerned about preparing for retirement are lured into contributed pre-tax dollars into 401(k) plans or tax-deductible contributions into IRAs.

Such qualified plans only give you tax-favored advantages during the contribution and accumulation phase of your retirement account. What about the most important phases, like withdrawing money for your retirement income or transferring any remaining funds to your heirs? Has anyone told you the rest of the story?

A Texas couple filing a joint tax return with taxable income in excess of $72,500 will be in a 25% marginal tax bracket. If they were fortunate enough to both qualify for deductible contributions to their IRAs, they would save $1,375 annually in taxes on a total contribution of $5,500 per year. However, most retirees will pay back every dollar to the IRS that was saved in taxes during the first 18-24 months of their retirement. In fact, the average retired couple will pay eight to twelve times the taxes during their retirement years than the taxes they saved during their contribution/accumulation years.

One of the original IRA/401k tenets held that deferring tax until retirement was advantageous because funds would likely be taxed at a lower rate. That is no longer true. You may spend retirement in the same or higher tax bracket if you accumulate a respectable retirement nest egg. In fact, tax rates are rising in the future. So why postpone the inevitable and compound the tax problem? Learn how to have tax-free retirement by educating yourself about a safe alternative to the stock market.

Is there a way to have your cake and eat it too? The answer is yes! Through proper planning, you may safely utilize tax-free plan advantages during the accumulation years. More importantly, you can enjoy tax-free income during the retirement years and transfer any remaining funds to your heirs tax-free. This strategy can increase your spendable income and reduce taxes for you and your heirs.