Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 11-11-2014, 08:06 PM   #21
Thinks s/he gets paid by the post
 
Join Date: Mar 2010
Location: Kerrville,Tx
Posts: 2,718
Quote:
Originally Posted by Meadbh View Post
Yes, my understanding is that the charity would purchase the annuity for the donor with a portion of the donation, and use the remainder of the funds for operations. The donor would get a tax credit for the entire donation, and the tax credit can be applied to taxes over several years. I would imagine the rate of return is calculated on the purchase price of the annuity, and therefore the real rate of return would be lower as a percentage of the total donation. Annuity income is taxed as a combination of capital return and ordinary income, and the funds should come from non-tax-sheltered assets. At least that's how it works in Canada. YMMV.

https://www.sunnet.sunlife.com/files...F/810-1901.pdf

Annuity Rates Canada 2014 | Best Canadian 2014 Annuity Rates
In the US the maximum annuity rates are determined by the american council on gift annunities. Here is a link to a web site with some details:
The Stuff Behind Charitable Gift Annuity Rates - Tony Martignetti. Note that the residual value of the gift to the charity has to be no less than 50% of the original gift. The detailed rules suggest that a cpa or estate planning person be involved. But the concept at least
is a way to make a gift and ensure that some income is coming in. (One might also use it as another form of longevity insurance)
__________________

__________________
meierlde is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 11-11-2014, 08:33 PM   #22
Recycles dryer sheets
 
Join Date: Aug 2013
Posts: 349
This thread reminds me of my younger days when I heard about DINKs and SINKs. I always said my wife and I wanted to be FINKs. Well, we're FI but with kids.
__________________

__________________
aim-high is offline   Reply With Quote
Old 11-11-2014, 09:50 PM   #23
Moderator
rodi's Avatar
 
Join Date: Apr 2012
Location: San Diego
Posts: 8,817
Quote:
Originally Posted by aim-high View Post
This thread reminds me of my younger days when I heard about DINKs and SINKs. I always said my wife and I wanted to be FINKs. Well, we're FI but with kids.
I used to call myself a ZINK in college. Zero Income, no kids.
__________________
Retired June 2014. No longer an enginerd - now I'm just a nerd.
micro pensions 7%, rental income 18%
rodi is offline   Reply With Quote
Old 11-11-2014, 10:02 PM   #24
Recycles dryer sheets
 
Join Date: Aug 2013
Location: Cocoa Beach
Posts: 406
We are DINK's and I currently am unsure how to best address this issue.
I have no real interest in leaving tons of money to people, or charities, when we are gone that could have been spent over our retirement to make our lives better.
We will be retiring at age 50 (both) in 3 years and am currently planning for a 40 year retirement to be funded at $100K per year (FIRECalc 100% success rate at 3.34% withdraw).
We currently are going with the "padding" approach by setting aside an additional 3 years worth of budget that is not included in any of our calculations as us both being dead, with some money leftover, is much better than one of us being alive with no money left.
__________________
Lucantes is offline   Reply With Quote
Old 11-11-2014, 10:17 PM   #25
Full time employment: Posting here.
martyp's Avatar
 
Join Date: Sep 2010
Location: Bangkok
Posts: 963
If there is anything left over then I will have it given to the charity of my choice.
__________________
Happy, Wild, and Free
martyp is offline   Reply With Quote
Old 11-11-2014, 10:30 PM   #26
Full time employment: Posting here.
 
Join Date: Aug 2009
Posts: 522
Quote:
Originally Posted by samclem View Post
How about subtracting a "pad" (10 years is probably fairly conservative, many people might prefer 5 years) from your age, and taking the IRS RMD for the resulting age? Keep adjusting every year. The RMD is calculated to run you out of money over the average expected remaining lifespan for a person your age, and subtracting the "pad" makes the withdrawal rate less aggressive, so it is highly likely the money will outlast you. It still will leave money on the table, but it will be a lot less than a straight 2% (or 4%), etc.

Using a 10 year "pad":
Actual age Approx Yearly "take"
80............. 3.7%
90. . . . . .. 5.3%
100. . .. . . . 8.8%

According to this article that I read the RMD is already 10 yrs more conservative than the average life span. So in fact maybe one could use that as a pad?

http://www.marketwatch.com/story/put...4?pagenumber=1


Sent from my iPad using Early Retirement Forum
__________________
bmcgonig is offline   Reply With Quote
Old 11-11-2014, 11:04 PM   #27
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: May 2004
Posts: 11,615
Quote:
Originally Posted by bmcgonig View Post
According to this article that I read the RMD is already 10 yrs more conservative than the average life span. So in fact maybe one could use that as a pad?

Put retirement savings withdrawals on autopilot - MarketWatch
Thanks. Yes, a good article, it might be just what the OP is looking for. It notes that the IRS RMD pad (years added to the average life expectancy for someone that age) is about 10 years for those in their 60s, going down to about 3 years for those aged 100. That seems fairly conservative in itself. At 80 years old the IRS RMD still uses a baseline of 19 more years of life, and only has folks taking withdrawals of 5.3%. The "Life Tables" from CDC indicate that a US person (avg male and female) age 80 should expect to live just slightly less than 9 years.
__________________
"Freedom begins when you tell Mrs. Grundy to go fly a kite." - R. Heinlein
samclem is offline   Reply With Quote
Old 11-11-2014, 11:43 PM   #28
Thinks s/he gets paid by the post
 
Join Date: Jun 2014
Posts: 1,035
Quote:
Originally Posted by samclem View Post
Thanks. Yes, a good article, it might be just what the OP is looking for. It notes that the IRS RMD pad (years added to the average life expectancy for someone that age) is about 10 years for those in their 60s, going down to about 3 years for those aged 100. That seems fairly conservative in itself. At 80 years old the IRS RMD still uses a baseline of 19 more years of life, and only has folks taking withdrawals of 5.3%. The "Life Tables" from CDC indicate that a US person (avg male and female) age 80 should expect to live just slightly less than 9 years.

That's interesting. So if you are old enough to have RMD, you should probably be spending at RMD if you aim to maximize consumption before death. Pad built in.


Sent from my iPhone using Early Retirement Forum
__________________
dallas27 is offline   Reply With Quote
Old 11-12-2014, 12:00 AM   #29
Thinks s/he gets paid by the post
 
Join Date: Mar 2010
Location: Kerrville,Tx
Posts: 2,718
Quote:
Originally Posted by samclem View Post
Thanks. Yes, a good article, it might be just what the OP is looking for. It notes that the IRS RMD pad (years added to the average life expectancy for someone that age) is about 10 years for those in their 60s, going down to about 3 years for those aged 100. That seems fairly conservative in itself. At 80 years old the IRS RMD still uses a baseline of 19 more years of life, and only has folks taking withdrawals of 5.3%. The "Life Tables" from CDC indicate that a US person (avg male and female) age 80 should expect to live just slightly less than 9 years.
If you look at IRS pub 590 you find that table 3 which is used for unmarried account holders and married folks where the spouses are within 10 years of the same age, goes to 115, where the table says that you should distribute 53% per year. It hits 10% at about age 92. Look at table 3 here.
So I would agree that there is padding. In fact if you look at table 1 for beneficiaries it says 17.0 at age 70 while table 3 says 27.4 years, thus about a 10 year pad is built in, for the account owner.
__________________
meierlde is offline   Reply With Quote
Old 11-12-2014, 06:43 AM   #30
Thinks s/he gets paid by the post
 
Join Date: May 2014
Location: Utrecht
Posts: 2,213
Also SINK here.

At my current age I'll statistically have 40 to 60 years to go. A big variability, but my focus should be on getting through the 40 years first

At 70 (or 80) that becomes 5 to 30 years. Almost all variable. At that point it makes sense to pool my longevity 'risk' with others. (so strange to call living long a 'risk').

Current plan is therefore to convert a portion of my assets to a single premium immediate inflation-adjusted lifetime annuity at that age, with no survivor benefits. I should get a high monthly income for the capital I put in (8% per year?), and thus have some left over (maybe half or more?).

The rest I'll either giveaway to family, charity, foundation, thinktank or to create my own themepark with blackjack and hookers.
__________________

__________________
Totoro is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Hi! 29yo DINKS from Tampa Bay LovinLifeinFL Hi, I am... 9 05-13-2011 04:18 AM
SWR for FIRE DINKS intent FIRE and Money 19 05-08-2011 04:41 PM
dinks in northern VA robbridg Hi, I am... 14 01-12-2011 06:17 AM
24 with 27yr old Dh, dinks. Stella. Hi, I am... 2 01-02-2011 08:18 AM
Seeking tax planning tips for 2010 - DINKs w/ $250k income soupcxan FIRE and Money 16 03-28-2010 06:05 PM

 

 
All times are GMT -6. The time now is 09:47 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.