Posted by I just finished my 2024 tax return. This year the standard deduction for a single filer was $14,600. My reportable income was $14,2XX on federal form 1040. That means zero taxes due. The State form shows that I owe $72. This was because they added tax-exempt municipal bond fund income onto the State form. I could have taken one more $300 withdrawal from my IRA, but I didn’t want to risk going over the standard deduction. I have been managing without the IRA withdrawal so far this year, so I will continue to let the IRA grow.
This was the fifth year of filing as a non-working, pre-retirement individual. I don’t have a total on my annual living expenses, but I’m sure that all my reported income was spent. The last time I checked, our monthly expenses were $1285. I’m sure that number has increased in the past year. It is probably closer to $1400, mainly due to food and insurance increases. Many expenses in pre-retirement are lower. Not driving to work every day is a big one. I used to spend $60 per month on gas, now it’s more like $20.
Despite all of the unknowns in the stock market, my IRA is about at the same level as it was a year ago. I attribute this to a balanced portfolio and higher interest rates. We are still getting 4% on treasury funds, but it sounds like that may not be the case by the end of the year. I remember not too long ago when 0.25% was the rate of return. It will be hard to get used to lower rates because the interest off-sets stock losses. It is rare that I don’t have a net loss to report in my brokerage account. I find it hard to make money trading individual stocks. I sometimes look for an ETF that has a high percentage of a stock that I like (NVDA). That doesn’t always work out. In January I was up about $1200 on PSI (Invesco Semiconductors ETF). Two months later, I’m only up by $100, thanks to Trump’s tariffs.