I retire this July 1 at age 55. Wife is 50 and will continue as a teacher for 5 - 7 more years. Our after-tax annual expenses are about 90K and she takes home about 40K so we need to crack the piggybank for about 50K / year.
Lump-sum pension is rolling into a Vanguard IRA. Can't touch that until I'm 59.5 but ~100K of it is my after-tax contributions, which I assume I can grab right at 55 without taxes or penalty (right?)
I understand that I can tap my 401k at age 55, paying taxes but no penalties. I'm keeping the Fidelity 401k because I need the dough between 55-59.5 and for conservatorship diversification (IRA is 1.9M, 401k is 600K). We have another 80K in after-tax accounts. Wife gets 28K COLA'd annual pension upon retirement & my SS is supposed to be about the same at age 66.
By force of habit we max out her 403b (currently 22K/year). Her 403b is in an equity-indexed fixed annuity which has early-surrender penalties for another 8 years (I was young and stupid). Since I need to dip into my 401K, should we cut out her contribution so she takes home 22K/yr more (before taxes)? Is it a wash tax-wise if her effective income goes up 22K or if I make up the difference with 401k withdrawals? Should I burn through all our after-tax funds first?
Thanks!
Lump-sum pension is rolling into a Vanguard IRA. Can't touch that until I'm 59.5 but ~100K of it is my after-tax contributions, which I assume I can grab right at 55 without taxes or penalty (right?)
I understand that I can tap my 401k at age 55, paying taxes but no penalties. I'm keeping the Fidelity 401k because I need the dough between 55-59.5 and for conservatorship diversification (IRA is 1.9M, 401k is 600K). We have another 80K in after-tax accounts. Wife gets 28K COLA'd annual pension upon retirement & my SS is supposed to be about the same at age 66.
By force of habit we max out her 403b (currently 22K/year). Her 403b is in an equity-indexed fixed annuity which has early-surrender penalties for another 8 years (I was young and stupid). Since I need to dip into my 401K, should we cut out her contribution so she takes home 22K/yr more (before taxes)? Is it a wash tax-wise if her effective income goes up 22K or if I make up the difference with 401k withdrawals? Should I burn through all our after-tax funds first?
Thanks!