10. Watch out for taxes
If your only income in retirement is from Social Security, you probably won’t have to worry about paying income tax. But if you have additional income from other sources — depending on the amount — you can be taxed on up to 85 percent of your benefits.
Taxes are based on your combined income: your adjusted gross income plus half of your Social Security benefit plus non-taxable interest. You can reduce your tax bill in retirement by cutting expenses so you need less income and choosing investments with an eye to reducing taxes.