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Am I missing something?
Old 02-12-2016, 11:17 AM   #1
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Am I missing something?

My DW and I both have IRAs that are earning approx. 7%. I have a 403b that is earning approx 3%.

We have a projected monthly budget need (after Soc. Sec.) of $3000.

It seems obvious to me that when I retire (class of 2017), I should begin by withdrawing the full $3000 from the 403b account. Am I missing something?
That strategy seems too simplistic.

A follow-up question is this: Would this have to be readjusted when I reach 70 years of age to make the RMD or can I continue drawing from the lower performing account as long as I still withdraw to that RMD threshold?
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Old 02-12-2016, 12:30 PM   #2
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Yes too simplistic.

What you want to do is to maintain a target asset allocation (AA) that reflects your appetite for investment risk and tailor your withdrawals to maintain that AA.

Provide more info and perhaps we can be of help.
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Old 02-12-2016, 12:41 PM   #3
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Is there a reason you can't roll the 403b monies over to an (or the) IRA? (I did that when I left academia; fewer accounts, fewer worries.)
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Old 02-12-2016, 01:41 PM   #4
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Quote:
Originally Posted by 2017ish View Post
Is there a reason you can't roll the 403b monies over to an (or the) IRA? (I did that when I left academia; fewer accounts, fewer worries.)

And possibly fewer hidden expense fees in those often flea ridden mangey dog accounts.


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Old 02-12-2016, 01:45 PM   #5
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Is there a reason you can't roll the 403b monies over to an (or the) IRA? (I did that when I left academia; fewer accounts, fewer worries.)
Because it says he is "class of 2017" -- i.e. not retired yet, and many plans don't let you perform in-service transfers.

And that said, to the OP, long-term you need to be earning more than 3% if your retirement savings is a crucial component for making the "retirement numbers" work.
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Old 02-12-2016, 01:52 PM   #6
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Right. Can't roll anything yet...just thinking ahead. When all the accounts were earning similar returns, this wasn't a concern.


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Old 02-12-2016, 01:58 PM   #7
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My question, which apparently was ill-phrased, was directed at post retirement. When you leave academia (or other nonprofit)--is there anything to prohibit you from rolling 403b over at that point? If not, that would enable you to get the same return from each (or, to get your asset allocation right). No reason to leave it behind earning less than your IRAs.
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Old 02-12-2016, 02:25 PM   #8
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Way too many undisclosed details to make an evaluation.
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Old 02-12-2016, 02:49 PM   #9
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Is the 3% from a guaranteed interrest account in the 403(b)?
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Old 02-12-2016, 03:10 PM   #10
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Is the 403b account an annuity? If so, there are probably surrender charges in effect for 5-10 years if you're thinking about moving the money to a IRA.
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Old 02-12-2016, 06:11 PM   #11
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Unless your 403b has a stable value fund or some really unique, low cost investment options I would consider consolidating the 403b into the IRA once I retire.
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Am I missing something?
Old 02-12-2016, 06:23 PM   #12
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Am I missing something?

Quote:
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Is the 403b account an annuity? If so, there are probably surrender charges in effect for 5-10 years if you're thinking about moving the money to a IRA.

Yes, it is an annuity. But as I understand it, I get to set the payout amount ( which would shorten the length of the payouts).


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Old 02-12-2016, 09:03 PM   #13
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OK, please start another forum topic and share the details when you start drawing your annuity. My wife has an annuity from her 403b plan, and I was planning to convert it until I saw the 15 page form that needs to be completed to close the annuity and convert it to an IRA.
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Old 02-13-2016, 04:02 PM   #14
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15 pages? I don't think so.
We can end this thread.


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Old 02-13-2016, 10:28 PM   #15
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OK - slight exaggeration on my part. The document to terminate an 403b annuity is 14 pages total. Pages 1-6 is a form that must be completed, while pages 7-14 are instructions/disclosures.
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