Financial Blog

5 Retirement Planning Strategies for High-Income Professionals

Kris Alban | Feb 16 2026 18:43

Why Retirement Planning Looks Different for High-Income Professionals

 

If you’re earning well into six figures, traditional retirement advice can feel a little off. “Save 10–15% of your income,” they say – but when your income is high, that advice barely scratches the surface. You’re likely maxing out your 401(k), phasing out of Roth IRA eligibility, and wondering how to avoid a monster tax bill later.

 

In short: your financial complexity grows with your income.

 

That’s why high-income professionals need a customized strategy – one that integrates tax planning, investment allocation, and smart use of multiple account types.

 

1. Max Out Tax-Advantaged Accounts (and Then Some)

Traditional 401(k) vs. Roth 401(k)

 

For high earners, the first big question is where to direct contributions. Many discussions revolve around this question:

 

“Roth vs. Traditional 401k if you make over $300k?”

 

Generally, high-income professionals in top tax brackets benefit more from Traditional 401(k) contributions. You get an immediate tax deduction today – when your marginal rate is high – and can plan for strategic withdrawals in lower-tax retirement years.

 

Still, if you expect to have even higher income later, or value tax diversification, splitting contributions between Roth and Traditional 401(k) can be wise.

 

The Mega Backdoor Roth Strategy

 

Once your standard 401(k) is maxed out ($23,000 employee + possible employer match), you may be able to contribute after-tax dollars up to the total limit of $69,000 (2025).

 

If your plan allows in-service rollovers, those after-tax contributions can be converted into a Roth IRA – known as the Mega Backdoor Roth.

 

This is one of the most powerful retirement planning moves available to high-income professionals. It effectively lets you shovel tens of thousands of additional dollars per year into tax-free growth.

 

2. Build a Tax-Efficient Investment Strategy

 

When your income exceeds Roth IRA limits, you’ll need to get creative – not just about where to invest, but how.

 

Use a Taxable Brokerage Account Wisely

 

For high earners, a taxable brokerage account becomes an essential part of the retirement toolkit.

You’ll want to:

 

  • Prioritize tax-efficient index funds and ETFs with low turnover

  • Hold municipal bonds(if in a high-tax state) for tax-free income

  • Harvest losses strategically to offset capital gains

 

This gives you flexibility to access funds before age 59½ – something tax-deferred accounts can’t offer.

 

Balance Pre-Tax, Roth, and Taxable “Buckets”

 

The goal is tax diversification . You don’t know what future tax rates will be – but by spreading assets across pre-tax, Roth, and taxable accounts, you gain flexibility when drawing income later.

 

3. Plan Around Future Tax Brackets

 

Retirement planning for high-income earners is often more about tax forecasting than investing.

 

Think Beyond Today’s Bracket

 

Most professionals expect their tax rate to drop in retirement – but that’s not always the case. If you’ve built significant pre-tax balances, required minimum distributions (RMDs) could push you into higher brackets later.

 

That’s why many fee-only planners run Roth conversion analyses in your 50s and early 60s – intentionally converting some pre-tax money into Roth before RMDs begin, locking in lower rates now.

 

Leverage HSAs and Deferred Comp Plans

 

If available, maxing a Health Savings Account (HSA) provides triple tax benefits. And for executives, nonqualified deferred compensation plans (NQDCs) can help shift income into lower-tax retirement years – though they require careful coordination with your company and advisor.

 

4. Don’t Ignore Lifestyle and Estate Planning

 

High-income professionals often think in terms of accumulation – but wealth preservation matters just as much.

 

Protect What You’ve Built

 

Ensure you have:

  • Adequate life and disability coverage

  • Umbrella liability insurance

  • Estate documents(will, power of attorney, healthcare directives)

  • Beneficiary designations reviewed annually

 

As your wealth grows, so does your risk exposure – both financially and legally.

 

Align Money With Meaning

 

Retirement isn’t just a math problem. It’s also about values, lifestyle, and purpose.
Whether it’s charitable giving, legacy planning, or helping your kids financially, your plan should reflect what matters most.

 

5. When Do I Need Fee-Only Financial Planning?

 

High-income professionals often reach a point where DIY planning starts costing more in missed opportunities than it saves.

A fiduciary financial adviser  can:

  • Integrate your investments, taxes, insurance, and estate plan

  • Coordinate with your CPA and attorney

  • Run detailed tax projections to time conversions and withdrawals

  • Keep your strategy aligned as laws and income change

 

If you’re balancing RSUs, deferred comp, multiple 401(k)s, and rising taxes – you’re past the “do-it-yourself” phase.

 

FAQ's

 

Q: How much should a high-income professional have saved for retirement?
Benchmarks like “2x your salary by 35” often don’t apply to high earners. Focus instead on saving 20–30% of gross income and projecting your post-tax retirement needs.

 

Q: Can I still contribute to a Roth if I make too much?
Yes – via the backdoor Roth (converting a non-deductible IRA contribution). Just watch out for the pro-rata rule if you already have pre-tax IRA funds.

 

Q: What’s the best investment mix for high-income professionals?
A globally diversified portfolio with tax-efficient ETFs and municipal bonds works well. Add alternative investments (private credit, real estate) only if they fit your risk tolerance and liquidity needs.

 

Q: How do high earners avoid high taxes in retirement?
By spreading assets across account types (pre-tax, Roth, taxable), strategically timing withdrawals, and using Roth conversions before RMDs hit.

 

Key Takeaways

  • Standard advice doesn’t fit high earners – your plan must factor in taxes and complex account rules.

  • Max your 401(k), explore Mega Backdoor Roths, and use a taxable account strategically.

  • Tax diversification beats trying to predict future rates.

  • Protect what you’ve built with insurance and estate planning.

  • Consider fee-only financial planning  to integrate everything under one strategy.

 

Next Step

 

If you’re earning well but not sure your retirement plan is optimized, you don’t need more generic advice – you need a coordinated strategy.

At BSG Advisers, we specialize in helping high-income professionals design tax-smart, stress-free retirement plans that actually fit their lives.

 

Your Financial Destination in Downtown Apex

 

Located at 56 Hunter Street, BSG Advisers is easy to find. We are situated directly across from the Townhall Building, making us a simple stop for clients coming from Cary or Holly Springs. Skip the Raleigh traffic and meet us in the heart of Apex.

 

👉 Schedule a quick call to review your plan and identify opportunities you might be missing.