Smart Tax Moves Every Woman 50+ Should Know

Hey everyone, even though taxes aren’t the most exciting topic, they do, unfortunately, matter. And they really matter for single women because of how the single tax brackets, versus married, are structured. And taxes can really become one of your biggest lifetime expenses. So, I wanted to go through a few strategies that can possibly stop you from paying more than you need to. All 3 of these are going to be simple and approachable ways to reduce taxes, increase savings, and maybe even help reach certain goals you may have.

1.        Catch-Up Contributions

Let’s start with the first one which is catch-up contributions.

How this work is once you hit age 50, the IRS lets you put extra money into retirement accounts. For 2025, the standard contribution limit for a 401(k) is $23,500. But if you’re 50 or older, you can add another $7,500, for a total to $31,000. If you’re between the ages of 60 and 63 you can actually get a “super” catch-up which lets you put an additional $11,250 rather than just $7,500. And for IRAs, the normal limit is $7,000, but you get an extra $1,000 to contribute, so that’s $8,000.

Now, why does this matter? Well, let me give you an example.

Let’s say Mary is 55 and still working. She decides to take advantage of the catch-up contribution in her 401(k). She contributes the extra $7,500. That’s an extra $7,500 she can deduct from her taxes that year. And she can keep on doing that year after year after year.

And here’s the thing — if your employer offers a Roth 401(k), you could also put that catch-up money in there. It won’t lower your taxes today, but all of that growth will be tax-free in retirement, which is really cool. It comes down to your situation and what you need most: a tax break now or tax-free withdrawals later.

2.        Health Savings Accounts (HSAs)

Next up is the Health Savings Account, or HSA.

If you’re still working and have a high-deductible health plan, the HSA is probably the most tax-advantaged account out there. Here’s why:

Your contributions are tax-deductible.

The money grows tax-free.

And withdrawals for qualified medical expenses are tax-free.

That’s the only account I know of that gives you a triple tax benefit.

As an example, let’s say Mary is 52, puts away $4,300 a year into her HSA. If she invests that money and it grows at, say, 6% a year, by the time she’s 65 she could have around $80,000, give-or-take, in her HSA. And remember, healthcare is one of the biggest costs in retirement — especially for women, since statistically woman live longer and because of that, spend more on healthcare.

So, instead of scrambling to pay medical bills with money that is taxable, Mary can have this tax-free bucket ready to go. And after age 65, she can even use HSA money for non-medical expenses, but the withdrawals will just be taxed like an IRA, she just won’t have a 20% early withdrawal penalty like she would have had before 65.

One other thing, because we were talking about catch-up contributions before, HSAs also have catch-up contributions, for 2025, if you’re 55 and older, and not enrolled in Medicare, you can add another $1,000 each year.

3.        Qualified Charitable Distributions (QCDs)

Now let’s talk about giving — because a lot of women I’ve worked with are very charitable. They want to support causes, churches, nonprofits that matter to them. And there’s various ways to do that and save on taxes.

One of the ways is called a Qualified Charitable Distribution, or QCD. Here’s how it works: Once you’re70½, you can give money directly from your IRA to a qualified charity. That money doesn’t show up as taxable income for you, but it still satisfies your Required Minimum Distribution, or RMD.

So, let’s say Mary, age 72, has to take a $20,000 RMD this year. She doesn’t need all of that money to live on, and she was already planning to donate $10,000 to a church. Instead of taking the $20,000 as income, paying taxes on it, and then writing a check, she can send that $10,000 directly from her IRA to the church.

The $10,000 never shows up on her tax return as income, which could also help her avoid higher Medicare premiums or other tax-related phaseouts, help her complete other financial planning goals, it could mean a great mix of different outcomes. And the church still gets the full $10,000. It’s really a win-win situation.

Takeaway

So, just to recap:

Catch-up contributions let you supercharge retirement savings and reduce taxes once you turn 50.

HSAs are a triple tax win that can help cover one of the, possibly, largest costs people have.

And QCDs let you give generously while keeping your taxable income lower later in life.

These aren’t complicated strategies. But they are powerful — and most women can greatly benefit from some of these.

And remember, taxes aren’t just about the current year. They’re also about long-term planning, meaning, what you do now can help you over the next 10, 20, 30 plus years.

I hope some of these resonated with you and you can make some changes for the better with your financial plan. Until next time, thanks for listening and I’ll see you on the next episode.