OT: Optimal withdrawal from retirement funds

[smontanaro]

Fast closing in on retirement, so will soon begin to start withdrawing money from my various pots of money (alas, no pots of gold). I know about common recommendations like the 4% rule. I'm more interested in deciding how to allocate whatever I decide to withdraw from the various pots (traditional IRA, Roth IRA, etc). Searching for "optimal retirement distribution" yields a number of interesting links which I need to pick through.

I could have sworn I saw references to at least one app (from an Internet Unicorn as I recall), but can't find it now. I wonder if something is out there or if I just dreamt it. Now that us Boomers are retiring left and right, it would seem there's got to be someone out there trying to monetize this calculation. Bonus points if it works offline to guarantee it doesn't share any numbers with its masters.

[Ozz]

Clearly, the "bike forum" answer is: Buy a new bike

The answer is always N + 1



PS - lots of smart guys here...you will get better advice than what I offered.

[kppolich]

Save the ROTH IRA for last. No RMD's for that when you eventually hit 70 1/2.

What types of retirement plans require minimum distributions?
The RMD rules apply to all employer sponsored retirement plans, including
profit-sharing plans, 401(k) plans, 403(b) plans, and 457(b) plans. The RMD rules also apply to traditional IRAs and IRA-based plans such as SEPs, SARSEPs, and SIMPLE IRAs.

The RMD rules also apply to Roth 401(k) accounts. However, the RMD rules do not apply to Roth IRAs while the owner is alive.

Link:
https://www.irs.gov/retirement-plans...-distributions

Redemption Strategies are an area of focus for our business (software for financial advisers). It might be worth 1 sit down to just talk for an hour and learn from a pro. I wouldn't let them manage your money, but find an hourly consultant type. It will save you tax money, as focused on here:

https://www.fidelity.com/viewpoints/...vy-withdrawals

[dem]

https://www.i-orp.com/ - is good for a tool.

https://www.bogleheads.org - is best to get qualified eyes on your specific circumstances

[jischr]

As mentioned above, think a about taxes. Taxes for the next couple years are as low as they will likely ever be. Consider moving as much taxed defered money to a taxed acccount without jumping from the 24% to the 32% bracket. If you have zero annual income that would be around $300K a year for a married filing jointly. Most moves are made in November when you have a good idea what your annual income for the year will be.

[teleguy57]

The financial planning world of the past couple of decades, particularly for retirement planning, looks about to be turned on its' head... and not necessarily in a good way with the likely elimination of stretch IRA provisions.

https://www.forbes.com/sites/jlange/.../#391db92045f6
https://www.financialpathways.net/bl...ure-money-grab

This is a time to work with a financial professional who is keeping on top of this stuff (surprising how many are not), who works as a true fiduciary with your best interested as a requirement (need I comment on that???) and being clear on your own goals and aspirations. Easy peasy...

[makoti]

Originally Posted by Ozz

Clearly, the "bike forum" answer is: Buy a new bike

The answer is always N + 1



PS - lots of smart guys here...you will get better advice than what I offered.

I don't think so...

[smontanaro]

Thanks for all the help/suggestions/recommendations, folks. I will follow up. I must say though, dhere is something attractive about the N+1 approach. Not sure my wife would agree.

[echappist]

Originally Posted by kppolich

Save the ROTH IRA for last. No RMD's for that when you eventually hit 70 1/2.

What types of retirement plans require minimum distributions?
The RMD rules apply to all employer sponsored retirement plans, including
profit-sharing plans, 401(k) plans, 403(b) plans, and 457(b) plans. The RMD rules also apply to traditional IRAs and IRA-based plans such as SEPs, SARSEPs, and SIMPLE IRAs.

The RMD rules also apply to Roth 401(k) accounts. However, the RMD rules do not apply to Roth IRAs while the owner is alive.

Link:
https://www.irs.gov/retirement-plans...-distributions

Redemption Strategies are an area of focus for our business (software for financial advisers). It might be worth 1 sit down to just talk for an hour and learn from a pro. I wouldn't let them manage your money, but find an hourly consultant type. It will save you tax money, as focused on here:

https://www.fidelity.com/viewpoints/...vy-withdrawals

good points;

to the OP, RMD are no laughing matter, especially if you have a sizeable pension. The tax-deductible retirement vehicles may be converted (all at once or portions at a time) into Roth vehicles, advantage being you can convert at a tax rate advantageous to you

bogleheads is the right place for this type of question

[rccardr]

Skip, I'm five years into successfully figuring this stuff out.
If you want to hit me up for an over-a-beer conversation at Coppi, let me know.
Doc

[rnhood]

Plan on withdrawing money so that your last check bounces. Then you planned it well.

Don't try leaving money for your kids to blow. The law will be changing, I believe, to hinder this. Its your money, so spend it.

[MikeD]

I think you should have a sizeable amount in cash or fixed income investments, enough to ride out a recession and drop in the stock market. You don't want to be selling stocks and real estate investments during a downturn.

[Bob Ross]

Whoa, in for later. Good thread

...especially that "N+1" thing.

[smontanaro]

Originally Posted by rccardr

Skip, I'm five years into successfully figuring this stuff out.
If you want to hit me up for an over-a-beer conversation at Coppi, let me know.
Doc

Doc,

Sounds like a plan. Definitely looking forward to the ride, festivities and swag. Can't hurt to have some useful conversation as well. Hope I won't be walking up too many hills.

Skip

[el cheapo]

Have to plan to live to 100 or.... die next week. Wouldn't it be great if we all came with an expiration date like on a milk carton.