72 T IRA distribution - Any experience out there

[zinger1457]

You don’t need to tie up anything, once rate is set, you can choose which fund to withdraw from: stock, bond, or money market. I generally choose the one is up for the year, otherwise I pull out short bond fund.

I was referring to the fact that once you start the 72t you won't be able to add or remove funds from that IRA account other than the SEPP payments.

 

[48Fire]

Fire Calc is returning 100% success rate. Currently 54 and feel that making it to the desirable retirement age of 57 might not be in the cards due to large merger. My biggest issue is the vast majority of funds reside in IRA’s, both traditional and Roth and a fairly sizable 401K.

Seeking thoughts and historical perspectives.

I am in the sixth year of my seven-year 72t commitment I have absolutely no regrets. Of course I was always planning on spending down my IRA as soon as possible. And, I don’t mind taking calculated risks, so it fits my emotional side.
Here are a couple of tips:
1. Read as much as you can at 72.net. There is a wealth of knowledge there. Also has a forum with helpful people that I joined. I asked a few specific questions as I got close.
2. When you set up your IRA for 72t, make sure your Financial Advisor is on board, and they know what you are doing. Not even some Financial Advisors are familiar with it.
3. Split your IRA into 72t and non-72t based on a ratio you are comfortable with. It is similar to an Asset Allocation (AA) on risk. I went with 90% in the 72t IRA, and 10% in the non-72t IRA. You could even do three IRA’s – 50% 72t, 40% for a future 72t, and then 10% in the non-72t IRA.
4. Document everything when you implement your plan. I created a 9 page document with screen shots of the assumptions, web sites, and actual money movements. I wanted to do this in case the IRA knocked on my door, for my own understanding in the future, and for any beneficiary information in case I did not survive the seven year plan.
5. I move my money within Vanguard from the 72t IRA to a non-IRA fund. I then set up a monthly, automatic withdraw to my checking that looks like paycheck.
6. Last, and most important, once you make the decision, don’t second-guess. 99% of the people you talk to will think you are crazy.
Good luck!

 

[teejayevans]

I was referring to the fact that once you start the 72t you won't be able to add or remove funds from that IRA account other than the SEPP payments.

True, but you can split the IRA into separate accounts, keep 1 IRA as “backup” in case you want to remove funds (roth conversion, hsa transfer).

 

[ziggy29]

I started 72t last July, when we moved and I left my part time postal j*b. I am committed to withdrawing about $38K a year until 2025, when I will be 59.5 years old. The most important thing, I think, is to know how much you need, and perhaps move some money into multiple IRAs for maximum withdrawal flexibility.

Plus, my wife is still working as a pastor, and she has to pay self employment taxes. So we take more out of my IRA where there are no FICA or SECA taxes due, and use that to increase contributions to her church 403B plan which can be taken out before the 15.3% self employment tax hit.