Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
How do you Withdraw RMD?
Old 05-17-2019, 09:32 AM   #1
Recycles dryer sheets
 
Join Date: Apr 2008
Posts: 383
How do you Withdraw RMD?

I will be 70 next year. All my funds are at Fidelity. Will they contact me about RMD? Do I need to contact them? I do not have an account contact with them. Do you select what to withdraw from where? Do they have an "equally from all" option? I am planning to take the full years RMD during first qtr. Just curious how others handle their RMD with Fidelity/ Vanguard/ Schwab etc. Fidelity does have a brick and mortar in my town but I haven't been there.
__________________

Idnar7 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 05-17-2019, 09:41 AM   #2
Thinks s/he gets paid by the post
 
Join Date: Nov 2011
Posts: 3,069
"Equally from all" I don't recall seeing such an option. An important element is computing your RMD, as the penalties are steep if you withdraw too little. This also means the brokerages are timid about telling you your RMD. They might suggest a dollar amount, but it comes with caveats because they don't want to be held resposible for a miscalculation.

If you use the online features at the brokerages there will be an option to withdraw from IRA. You can sell off any liquid holding you wish. Many people sell some/all an investment that has overperformed relative to the others, in order to lock in the gains.
__________________

GrayHare is online now   Reply With Quote
Old 05-17-2019, 09:45 AM   #3
Confused about dryer sheets
 
Join Date: Feb 2014
Location: Livonia
Posts: 6
You can set up your RMD from your account in Fidelity online. Fidelity will calculate how much you need to take out. Here is the link to read up about in on Fidelity website.
https://moneymovement.fidelity.com/f...m/mmRDCLanding
Magoo30 is offline   Reply With Quote
Old 05-17-2019, 09:53 AM   #4
Thinks s/he gets paid by the post
Souschef's Avatar
 
Join Date: Dec 2015
Location: Santa Paula
Posts: 2,314
All the IRS cares about is the total amount. They do not care which IRA you withdraw the money from, or how much from each one.
I recognize I am a little compulsive about this. I have a spreadsheet that calculates my yearly RMD based on the IRS tables.
I have a schedule for withdrawals based on the quarterly estimated tax payments. I also have scheduled withdrawals for our sons' birthdays.
I have simplified the process by drawing down one account and closing it, so I only have 2 accounts to deal with.
__________________
Retired Jan 2009 Have not looked back.
AA 50/45/5 considering SS and pensions a SP annuity
WR 2% SI 2SS & 2 Pensions
Souschef is offline   Reply With Quote
Old 05-17-2019, 09:54 AM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Sunset's Avatar
 
Join Date: Jul 2014
Location: Spending the Kids Inheritance and living in Chicago
Posts: 7,143
OP - Why don't you phone Fidelity and ask them ?
They have a support phone number and you can be sure many of their clients call about RMD's.
__________________
Fortune favors the prepared mind. ... Louis Pasteur
Sunset is offline   Reply With Quote
Old 05-17-2019, 09:56 AM   #6
Thinks s/he gets paid by the post
 
Join Date: Nov 2016
Posts: 2,472
With the Company I'm with I can sell of what funds I want to sell at RMD time. It will then just roll over to the market funds I want them to go to. I will have them go right back into the same funds but of course will be taxable in the stock market. My Company that I'm with will do the RMD automatically each year if I want it that way.
street is online now   Reply With Quote
Old 05-17-2019, 10:01 AM   #7
Full time employment: Posting here.
davebarnes's Avatar
 
Join Date: Dec 2015
Location: Berkeley, Denver, CO, USA
Posts: 654
Fidelity shows you a "warning message" with the amount you need to withdraw this year.

My tactics (at age 70.5) are to withdraw all our needed spending money from my IRA. So, I am way over the RMD. Hopefully, my tIRA will be smaller in a decade when the RMD % is much higher.
I am leaving my wife's tIRA untouched until she hits 70 in 8 years.
__________________
Dave Barnes
Old (70.7) Fart Nerd
AA 72/22/5, WR=3.6%, 91.6% retired, still working 1/2ish hrs/day
davebarnes is offline   Reply With Quote
Old 05-17-2019, 10:03 AM   #8
Thinks s/he gets paid by the post
 
Join Date: Jan 2006
Posts: 3,596
My experience is that most, if not all,custodians provide a notice in January telling you that RMD is required with a $$ amount. For IRAs, that is typically all that will happen. It is up to you to request that the RMD be distributed........either automatically with the timing you specify or manually by requesting specific $$ amounts and desired withholding. If you have multiple IRA accounts, you can take your total RMD from a single one or any combination of accounts.............and since you can do this, custodians will not automatically do anything since they don't know what you plan to do.

For 401Ks, you have to take the RMD out of every single one in the required amounts. Since the custodians then know what each RMD is, many will have a default withdrawal late in the yr to protect you from penalties.
401K plan details can vary by employer. My employer plan default at Fidelity is to withdraw pro-rata from each investment. Some plans allow you to specify which investments to draw from first.......so,it depends........
kaneohe is offline   Reply With Quote
Old 05-17-2019, 10:15 AM   #9
Thinks s/he gets paid by the post
 
Join Date: Dec 2014
Location: Florence, AL/Helen, GA
Posts: 3,488
My wife was 70 last June, and I got a little lazy and didn't withdraw the RMD until the market dropped at the EOY. So I had until 4/1/2019 to make her last year's RMD. She has until 12/31/2019 to make this year's withdrawal. So I'll have to pay taxes on 2 years' withdrawals this one year only.

Yes, you will get a couple of letters from Fidelity telling you RMD's are required to avoid a 50% penalty--and the minimum withdrawal. You must have a money market "cash" account with Fidelity. You put through a sell order on the mutual funds and the proceeds will go into the cash account. At the same time, you specify your state and federal withholding tax amounts. Then you put an order in 2 days later to transmit the funds to your home bank account. It's very easy to work the system.

The decisions are when to sell, as you want to pick the date when the market's up. And you need to think about which funds to sell (if you're diversified). Do you sell the non-performers and keep the best funds?

Nice that you have a Fidelity office in your city. I don't. It's nice to have them to answer questions in person if you have any. Most everything can be done online as they have a great computer system.
Bamaman is offline   Reply With Quote
Old 05-17-2019, 10:24 AM   #10
Thinks s/he gets paid by the post
Gotadimple's Avatar
 
Join Date: Feb 2007
Posts: 1,974
You should get a notice from Fidelity (I'm not with them but I'm sure many brokerages follow the same process). Also look at your IRA on the Fidelity website. My Schwab IRA shows me the value of my investments, the cash available, and the calculated IRA RMD that i need to take starting when I turn 70.5. It's also on my statement.

As you're a year away, I'd expect you'll see something in the mail about 6 months after you turn 69. With the RMD calculation showing up about the same time.
__________________
Only got A dimple, would have preferred 2!
Gotadimple is offline   Reply With Quote
Old 05-17-2019, 10:27 AM   #11
Recycles dryer sheets
 
Join Date: Dec 2016
Location: Encinitas
Posts: 234
You can call Fidelity and ask them the correct amount to withdraw for the year and they will calculate it for you. You can also ask them to execute the withdrawal - you'll need to specify what you want them to sell - at any time during the tax year. You will start to get reminders annually from them reminding you about RMDs.
Starsky is offline   Reply With Quote
Old 05-17-2019, 10:30 AM   #12
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Sunset's Avatar
 
Join Date: Jul 2014
Location: Spending the Kids Inheritance and living in Chicago
Posts: 7,143
Quote:
Originally Posted by kaneohe View Post
My experience is that most, if not all,custodians provide a notice in January telling you that RMD is required with a $$ amount. For IRAs, that is typically all that will happen. It is up to you to request that the RMD be distributed........either automatically with the timing you specify or manually by requesting specific $$ amounts and desired withholding. If you have multiple IRA accounts, you can take your total RMD from a single one or any combination of accounts.............and since you can do this, custodians will not automatically do anything since they don't know what you plan to do.

For 401Ks, you have to take the RMD out of every single one in the required amounts. Since the custodians then know what each RMD is, many will have a default withdrawal late in the yr to protect you from penalties.
401K plan details can vary by employer. My employer plan default at Fidelity is to withdraw pro-rata from each investment. Some plans allow you to specify which investments to draw from first.......so,it depends........
Good point, OP didn't mention any 401K's which are treated separately from IRA's.
__________________
Fortune favors the prepared mind. ... Louis Pasteur
Sunset is offline   Reply With Quote
Old 05-17-2019, 11:53 AM   #13
Recycles dryer sheets
The Cosmic Avenger's Avatar
 
Join Date: May 2016
Location: Mid-Atlantic
Posts: 469
Thanks, I had no idea it didn't matter which IRA it came out of, I've been doing it proportionately, as that's what Fidelity reports to me and that's what they will do for you automatically.

So to clarify, Fidelity DOES let you withdraw proportionally from all positions (e.g., Google is 40% of an account and Facebook is the other 60%, your RMD for the year is $10K, it would sell $4K of Google stock and $6K of Facebook stock for you). I have it set up that way, and I have 25% tax withheld for my own convenience. I don't like feeling like I have MORE money than I do...actually, I like it the other way around! If I don't feel like I have much, I don't spend as much.

Anyway, you can also have it automatically sent to another account, or you can have a check mailed to you, both of which I've done. I have had trouble getting it automatically transferred to another bank, but I have a Fidelity taxable investment account that has my other bank linked, and so I just have the RMD sent to the taxable account, where I can transfer it easily.

Note: unfortunately for me (in a personal rather than financial sense), these are both inherited IRAs, but while some things may be different (I have RMDs yet I'm only in my 40s), I don't think the account features are any different, though. I've been very pleased with Fidelity, they generally make things easy to do online, with a few exceptions, but fewer than any other bank/brokerage I've used.
__________________
Looking to FIRE in the mid-2020s, which would be our mid-50s.
The Cosmic Avenger is online now   Reply With Quote
Old 05-17-2019, 12:33 PM   #14
Thinks s/he gets paid by the post
 
Join Date: Jan 2006
Posts: 3,596
Quote:
Originally Posted by The Cosmic Avenger View Post
Thanks, I had no idea it didn't matter which IRA it came out of, I've been doing it proportionately, as that's what Fidelity reports to me and that's what they will do for you automatically.
.............................

Note: unfortunately for me (in a personal rather than financial sense), these are both inherited IRAs, but while some things may be different (I have RMDs yet I'm only in my 40s)................................
I would guess the rest of us weren't thinking about inherited IRAs. Assuming they were not inherited from spouse, these inherited IRA are a separate group or groups from your own IRAs. You can only aggregate RMDs of the same type......you can't group your own and inherited IRAs. For inherited IRAs, they need to be from the same owner to be aggregated.
kaneohe is offline   Reply With Quote
Old 05-17-2019, 12:57 PM   #15
Dryer sheet aficionado
 
Join Date: Feb 2015
Posts: 28
The rules donít require that you pull cash out of your IRA, only that a certain amount comes out of the tax shelter each year starting at age 70Ĺ so the IRS can tax it. Itís perfectly okay to have stock or mutual fund shares transferred from your IRA to a taxable account to satisfy your RMD.

So, if you donít need cash, just transfer your shares in-kind from the tax-deferred account, like an IRA, to your taxable account. That would satisfy the RMD requirement.
aza455 is online now   Reply With Quote
Old 05-17-2019, 01:04 PM   #16
Thinks s/he gets paid by the post
SecondCor521's Avatar
 
Join Date: Jun 2006
Location: Boise
Posts: 3,487
Although most of the thread is about Fidelity, OP mentioned Vanguard.

My Dad has his traditional IRA with Vanguard. He has it set up so they calculate his RMD amount for him, autosell proportionately $(RMD/12) every month on the 15th, withhold X% for federal withholding, then move the net proceeds to his Vanguard taxable money market.

It's nice to have things automated because about a year ago he started losing his mental acuity about such things.
__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
SecondCor521 is offline   Reply With Quote
Old 05-17-2019, 03:12 PM   #17
Thinks s/he gets paid by the post
 
Join Date: Nov 2011
Posts: 3,069
Note that if all of your IRA money is in the Roth variety of IRA, you have no RMD.
GrayHare is online now   Reply With Quote
Old 05-17-2019, 05:05 PM   #18
Thinks s/he gets paid by the post
SecondCor521's Avatar
 
Join Date: Jun 2006
Location: Boise
Posts: 3,487
Quote:
Originally Posted by GrayHare View Post
Note that if all of your IRA money is in the Roth variety of IRA, you have no RMD.
True. However, inherited Roths currently do require RMDs (unless you drain it all in 5 years).
__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
SecondCor521 is offline   Reply With Quote
Old 05-19-2019, 05:11 AM   #19
Thinks s/he gets paid by the post
Badger's Avatar
 
Join Date: Nov 2008
Posts: 1,183
My wife and I both have our IRAs in Vanguard. They are set up to sweep the dividends into a MM account to use as our RMD account. This year we will both be paying RMD and I called up for them to make the withdrawal and transfer to a taxable MM account for us to tap into through the year if needed. I will be setting up an automatic transfer at our chosen date for future years. So easy and all I intend to do is check the math to make sure the proper amount is transferred each year.


Cheers!
Badger is online now   Reply With Quote
Old 05-19-2019, 05:25 AM   #20
Thinks s/he gets paid by the post
 
Join Date: Jan 2006
Posts: 3,596
Quote:
Originally Posted by Badger View Post
................................. So easy and all I intend to do is check the math to make sure the proper amount is transferred each year.


Cheers!
Not sure which math you are referring to but it's not a bad idea to check their RMD calculation. I have a bunch of different custodians between IRAs/401Ks
and though the track record is quite good, once upon a time, a big name custodian calculated a bit off.........not much but enough to notice. Turns out somebody (or their computer) entered the yr end value at the start of the day instead of the end of the day/year.
__________________

kaneohe 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
How Do You Withdraw? Rianne FIRE and Money 52 03-27-2019 02:06 PM
RMD Folks how are you using the money street FIRE and Money 126 07-10-2018 05:15 PM
how much to withdraw from ira (RMD) frank FIRE and Money 12 01-16-2017 09:54 AM
61 and getting closer, a question on withdraw...does it pain you? Floridatennisplayer FIRE and Money 49 08-18-2016 04:09 PM
Did you miss the RMD last year? mickeyd Life after FIRE 4 01-14-2005 09:07 AM

» Quick Links

 
All times are GMT -6. The time now is 03:13 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2019, vBulletin Solutions, Inc.