How many ER readers are taking more than the RMD?

[The Cosmic Avenger]

In the thread "RMD Life Expectancy Update", Kitces says that only 20% of those subject to RMDs take only the minimum, 80% take more. I know this board is the Lake Woebegone of the Internet, but I was curious how our numbers compared.

(I know my choices are kind of like an inverted bell curve; I figure more people will be at the high or low extremes, with fewer in the middle, so I wanted to measure those ends more specifically. If I'm wrong, I'm wrong, but I wanted to account more for those near either end.)

 

[Red Badger]

I went with most of the time. As planned, we plundered our kitty extra getting from 60-62. Now throttling back. Will will also raid our stash to fund some foreseen moving expenses and one-off travel(s).

Also, we are comfortable with spending down a specific portion of our portfolio for travel and travel upgrades, while health permits. We have no plans to let heirs or the IRS to enjoy what we want to enjoy (we plan to leave a modest estate, but we come first).

 

[Another Reader]

Oops. I misread the poll, so my vote is wrong. At 8 votes, right now that's significant.

I rarely take more out now, took more in the early years. These are inherited IRA's. I'm not RMD age for mine yet.

 

[RunningBum]

I'm not of RMD age, so I didn't vote. However, I expect not to have any RMDs at all (due to Roth conversions between age 49-70), and I don't see an option for that. If I'm unable to fully convert, I'll look at the factors and decide whether to do just RMDs, or to convert any over the top of the RMD to a Roth. It's my understanding that you have to take the RMD first, then you are free to withdraw or convert beyond that.

 

[Badger]

We have only been taking RMD for a couple of years. The money goes into a taxable account and so far has not been touched. This will more than likely continue for many years to come. I guess we need to start spending some of it.


Cheers!

 

[marko]

I'm not RMD age but our current and expected future IRA withdrawals far exceed what our RMD will eventually be. As such, RMDs are moot for us.

 

[REWahoo]

Beyond rounding up to the nearest $100 I've never taken more than the minimum RMD amount.

 

[gerntz]

Since it's only applied 2X, hard to answer.

 

[GalaxyBoy]

I've only got a modest inherited IRA that is subject to RMDs and I'm only two distributions into it. But since I'm not yet of SS age and have nearly half of our assets are in after-tax accounts I have no need to take more than the required minimum. I use the RMD for income tax withholding with any balance being re-invested in the taxable account.

 

[audreyh1]

Not at RMD yet.

 

[Andre1969]

I'm not there yet, so I didn't vote. However, since I'll probably have a pretty hefty sum in IRAs by then, I have thought about starting to tap into it as soon as I hit 59.5, to help take the sting off of later years.

I'm 49 now, and have about $707K in IRAs/current 401k. So, if left totally alone, that could swell to a pretty big number by the time I hit 70.5. As it stands, the RMD on $707K would be around $26K at 70.5 (assuming it's still ~3.7% for the first year). The taxes on that shouldn't be too hideous. But, I have a feeling that 21 years of compounding is definitely going to add up.

 

[scrabbler1]

Still too young (56) to take RMDs. My IRA is one of my "reinforcements" but I doubt I'd need to tap into it right away even when I become eligible. I am near the top end of MAGI to get an ACA subsidy, so it is imperative to avoid any added income which would throw me over the increasingly greater cliff.


Like Andre1969, I'd get stung pretty good with my IRA's balance nearly as high as his, although I am closer to having to take an RMD than he is.

 

[Andre1969]

I just ran some numbers. Assuming I retire about 1/4 of the way into 2021, and also assuming a 7% return on investment...

By the time I hit 59.5 (2029), my $707K could grow to around $1.6M. If I left it untouched until 70.5 (2040), it would be around $3.2M! That first RMD would be around $118,400 (again assuming a 3.7% first RMD).

Now, I know inflation will take its toll, and tax brackets will rise, and possibly change, as well. But, I have a feeling that, while $118,400 won't seem like as big of a number, 21 years from now, it'll still be big enough to get hit with a pretty good tax bill.

Oh, and thanks for bringing up the ACA subsidy, Scrabbler. That's something I never looked into...but I guess maybe I should!

 

[Dtail]

Not at RMD yet, but expect to just take the minimum.

 

[aja8888]

I round up to the nearest $1,000.

DW takes minimum RMD, but when one of her children (by previous marriage) gets into a bind for a few $K, she pulls out what's needed and gives me the estimated tax owed to send in the next quarterly payment.

 

[corn18]

Plan to maximize conversions until 70 and then take the minimum.

 

[Alan]

Not at RMD yet but have already converted all my tIRA to a Roth IRA.

 

[dtbach]

not at RMD but already taking more than minimum now and expect to continue once I do get there.

 

[Moemg]

I only take the required amount .

 

[The Cosmic Avenger]

I'm not of RMD age, so I didn't vote. However, I expect not to have any RMDs at all (due to Roth conversions between age 49-70), and I don't see an option for that. If I'm unable to fully convert, I'll look at the factors and decide whether to do just RMDs, or to convert any over the top of the RMD to a Roth. It's my understanding that you have to take the RMD first, then you are free to withdraw or convert beyond that.

That's a good point, but I was just curious how members here who have been subject to a RMD behave compared to the 20% number Kitces cited as discussed in the other thread, so I intentionally only wanted to poll those who had been subject to an RMD. Once I have to start taking RMDs from my 401(k) I'll probably do the same as you. Shoot, I hope it didn't sound like I meant to exclude workplace plans.

 

[Golden sunsets]

Oops I voted wrong too. I read it too quickly. I voted never, but should have voted always.

 

[RunningBum]

That's a good point, but I was just curious how members here who have been subject to a RMD behave compared to the 20% number Kitces cited as discussed in the other thread, so I intentionally only wanted to poll those who had been subject to an RMD. Once I have to start taking RMDs from my 401(k) I'll probably do the same as you. Shoot, I hope it didn't sound like I meant to exclude workplace plans.

That's fine, I was just making a comment without skewing the poll by trying to vote when I'm not yet affected.

 

[Animorph]

I'm not RMD age yet. My plans depend more on tax bracket than RMD but have gone above RMD levels depending on circumstances. I think DW's lump sum pension we just took will affect that once again, as might an inherited IRA when the time comes.

DM is 90 and just takes RMD's.

 

[RobbieB]

I'm not at RMD age but I took my first one anyway. Pulled out my age 70 amount at age 64.

Blow That Dough!

 

[Offgrid Organic Farmer]

I do not have any assets in any account that has an RMD.