- Jul 20, 2001
And the wealthy class get the same deal on unearned income except 1) they get the capital gains welfare tax rate and 2) they get to enjoy that rate after holding their investments for only one year while working folks get penalized if they withdraw their investments before age 59.5.Because you never paid the tax on the 401k when you first contributed. You put in pretax dollars. And that money was allowed to grow tax free until retirement distribution. And you're complaining about that? That's crazy good deal.
Your tax rate in retirement should be pretty low since you'll likely be in lower tax bracket.