Retirement can feel like a fresh financial chapter, but taxes have a funny way of tagging along like an uninvited guest at a backyard barbecue. New retirees often discover that their income sources have changed, and their old tax routines may no longer fit the new reality.
Tax withholding choices become especially important when paychecks disappear and retirement income starts coming from pensions, withdrawals, annuities, or Social Security. A smart withholding decision can help avoid unpleasant surprises later, although no withholding choice guarantees a refund or a balance due.
