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Include these in your plans for Tax and Living Income planning.
Our retirement income streams were set-up to begin at age 68 which had been my intended retirement age for decades. I retired at age 64 so we will be drawing from my second career 401(k) for living expenses during the next 3 years. The 401(k) which becomes slightly problematic at age 72 because of potential RMDs will be exhausted by that point while other larger and tax shielded investments continue to grow.
Also don't forget that this year you don't have to file your Federal tax until May 15, possibly State taxes too depending on your location. But the Estimated Taxes from your IRA withdrawal etc., still need to be paid by April 15.
Also don't forget that this year you don't have to file your Federal tax until May 15, possibly State taxes too depending on your location. But the Estimated Taxes from your IRA withdrawal etc., still need to be paid by April 15.
This is a great example of why people hate the IRS. That's just dumb. Of course, it also seems dumb to me that that they pushed the filing deadline.
Include these in your plans for Tax and Living Income planning.
Our retirement income streams were set-up to begin at age 68 which had been my intended retirement age for decades. I retired at age 64 so we will be drawing from my second career 401(k) for living expenses during the next 3 years. The 401(k) which becomes slightly problematic at age 72 because of potential RMDs will be exhausted by that point while other larger and tax shielded investments continue to grow.
Just our situation and solution.
I said something earlier in another thread.
At age 72 now regardless of whether you need the money or not you will need to increase your fixed income by the required IRS amount. Yes there are tax consequences but there are also income consequences. For those with pensions and SS that exceed their spending resulting in continued retirement savings prior to RMD’s be prepared for more unneeded income. By age 72 that outcome may not have been fully appreciated at age 60.
You can firecalc all you want but 10-15 years later when one of the best case scenarios is a reality you realize how it could have gone the other way.
On the other hand I am big on the retirement want bandwagon.
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
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Quote:
Originally Posted by davebarnes
RMDs got you down?
Learn about QCDs.
Agreed, plus..... Be Sure to parcel out any Roth portion of your 401k before depleting it all pre-RMD.
My latest 401k allowed both Roth and taxable (traditional) options. With many yrs service, I ended up with 60% of my 401k as Roth. That portion is not being spent down pre- RMD.
QCD will be my vehicle of choice, as that will reduce my DAF outflow (which will provide perpetual gifting long after I'm cold and gone)
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