We’re in our mid-40s and are finally making big salaries – is there anything we can do to reduce our tax bill and retire earlier?

I know a lot of people who struggled with mediocre jobs and salaries during their 20s and 30s. Thankfully, many of those same people reached their 40s and finally found that their income started picking up.

One friend of mine, in fact, didn’t manage to become a homeowner until their 40s because they couldn’t afford it earlier. A promotion and big salary bump made that dream possible, but it took time to get there.

But while earning more money is of course a good thing, there’s a downside. The more money you make, the more it seems the IRS gets to take.

That’s the situation the couple in this Reddit post seems to be in. They’re in their mid-40s in a very high cost of living area with no kids. They’re aiming to retire in five to 10 years and have a lot of savings. But they’re looking to reduce their tax bill so they can retire early with less worry.

I have some suggestions for this couple that could help. But ultimately, getting custom advice is probably their best bet.

Max out all of the right accounts

Whenever I hear about people who want to reduce their taxes, my mind goes to IRAs and 401(k)s. Maxing out these accounts is a super easy way to keep the IRS away from some of your income.

Plus, you’ll need money to live off in retirement anyway. So you might as well pump as much as the IRS allows you to into an IRA or 401(k).

If you’re in your mid-40s, you can contribute up to $7,000 to an IRA in 2025, or up to $23,500 to a 401(k). And if you’re eligible for a 401(k) match, you should know that it doesn’t count toward the amount you’re allowed to contribute yourself.

Another account you can look to max out is an HSA, or health savings account. Just keep in mind that your health insurance plan needs to meet certain requirements for an HSA to be possible.

In 2025, you can contribute up to $4,300 to an HSA if you’re the only one covered by your plan and you’re in your mid-40s. If you have family health coverage, your limit roughly doubles to $8,550.

Get personalized advice

I love the idea of maxing out the accounts above. But if you’re a very high earner, you might need tax strategies that shield even more of your income from the IRS.

So to that end, I recommend consulting a tax professional or a financial advisor. Either one should be able to offer up ideas based on your specific circumstances. And that advice might hinge on where you get your money from.

For example, some people who earn a lot of money have businesses they own. Others get more of their income from their investment portfolios than the paychecks their employers give them.

Because of this, it’s best to get personalized guidance rather than blanket guidance. The suggestion to max out IRAs, 401(k)s, and HSAs is pretty universal. But a professional can help tailor a plan to your needs and goals.