Need to tap into your investments? Beware of tax traps

If dipping into your retirement savings is the only alternative to make ends meet it’s important to know the tax consequences vary depending on where you draw the cash from.

Ideally, you will already have some cash in your retirement accounts, but your needs could require liquidating investments. Selling investments in a pinch can be tricky in a market where just about everything is in a slump. A qualified investment advisor can help trim profits, or separate the duds from those poised to realize their potential.

You might also want to consult a tax expert. Any tax pro will tell you to never make an investment decision based solely on tax implications, but the amount of tax you pay on withdrawals often depends on how the money is stored and your personal situation.