Did the Bush tax cuts change anyone's FIRE plans?

[jIMOh]

Did the Bush tax cuts change anyone's FIRE plans?

consider:

dividends taxed at lower rates changed savings strategy

or

could retire on less than originally planned

or

the repeal of the tax cuts could delay retirement a year or two (or three...)

or something else not listed...

 

[clifp]

The lower of dividends taxed coupled with the lower capital gains rate dramatically changed my portfolio composition. I shifted from growth orient stocks/funds to dividend paying individual stocks.

When ER in 99, my plan was to take a few years off than rejoin the work force in a lower paying, more fun job. The bear market of 2000-2002 increased my likehood of doing this. However the tax cut was a roughly a 10% increase in the value of my future income so it decreased the need to unretire.

If the bear market continues for another few years and Obama raising taxes on dividends/cap gains, I'd consider getting out of retirement.

 

[NW-Bound]

I did remember trying to capitalize on the lower dividend tax rate, and picked up some utility companies. I figured people would be willing to pay more for them, so I bought for cap gains, not just dividend, though that helped too. I held them for 3-4 years, and sold some for some profits when they appeared to top out, and still have some.

In the final analysis, during that period lots of stocks were going up, so I could have bought something else and had the same gains.

 

[audreyh1]

No, but the capital gains tax rate went down from 28% to 20% under Clinton and that helped me BIG time, because it meant I could sell less company stock to reach my retirement goals. I really wasn't that eager to take profits on my stock with a 28% tax rate, but somehow the 20% rate made it much more palatable.

Then, after retiring, Bush provided more icing on the cake - 18%, then in a TOTAL surprise, 15% cap gains rates with the dividend tax cut. I really didn't expect that.

So, I have taken advantage.

And now it looks like things will reset to the higher rates - at least to 20%.

Audrey