Tax rates

Tax rate before retirement is the percent of your income you will pay in taxes on average from now until you retire. Your before retirement tax rate is applied to your earned income from salaries and your unearned income from taxable realized investment gains. A higher average tax rate reduces the money you have to spend and slows the compounding of your taxable investments.

Tax rate after retirement is the percent of your income you will pay in taxes on average each year after retiring. Your after retirement tax rate is applied to your salaries, benefits, and taxable realized gains due to investment growth or withdrawals from investments. The higher your tax rate after retirement, the more investments you'll need to sell to net enough money to cover your expenses.