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Old 01-09-2018, 11:43 AM   #41
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I like this idea,do any other members employ this strategy?

The amount subject to RMD is based on prior year's ending balance
OP, I use Schwab

kgtest, I take my withdrawals (72t for this early 50 something, not RMD) in late December for the year - gives me the whole year to accumulate. One downside of this is the danger of missing the withdrawal for the calendar year.

To avoid any trouble, I schedule these with Retirement Services. I could do them individually, but this way I have help if there is a health issue with me at the wrong time of the year. My withdrawal shows up as scheduled about a week before it is supposed to be done, so I do have a chance to verify it before it happens.

I also do an inherited IRA manually early in the year-it is very little and it's just less paperwork, and little concern if I mess up due to the small amounts involved. I just mention this because I can do either approach at Schwab with no problems.
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Old 01-09-2018, 11:52 AM   #42
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Someone in the 12% bracket is likely to owe 0% on capital gains, in which case they will pay less tax, perhaps no tax, by having cap gains instead of ordinary income.
If I draw out RMD's at the beginning of 2018 and put it in an investment that generates cap gains, won't they be short term gains if needed for spending? I think short term gains are taxed at ordinary income levels. In our case we will want those RMD's for spending. So I guess this depends on one's income spending streams.
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Old 01-09-2018, 12:08 PM   #43
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If I draw out RMD's at the beginning of 2018 and put it in an investment that generates cap gains, won't they be short term gains if needed for spending? I think short term gains are taxed at ordinary income levels. In our case we will want those RMD's for spending. So I guess this depends on one's income spending streams.
In that case to raise cash I'd simply sell a long term holding, such as one from the early RMD of the prior year.
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Old 01-09-2018, 12:32 PM   #44
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In that case to raise cash I'd simply sell a long term holding, such as one from the early RMD of the prior year.
Yes, but that has been spent in the RMD year withdrawn. That is the point. Some people will choose not to spend the RMD but others will. In our case we will spend it along with SS and Roth withdrawals.

Some could withdraw excess IRA distributions beyond the RMD to get at the cap gain treatment. In our case, that is not optimal.
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Old 01-09-2018, 12:47 PM   #45
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We're Flagship clients so the level of service we received was probably much better than if we weren't.

After that positive experience, I eventually moved all of our investment accts to Vanguard. We haven't started taking RMDs yet, but I have no reason to believe we'll have any difficulties. Knock wood.
I am also Flagship and have been so for many years but they still screwed up .
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Old 01-09-2018, 12:53 PM   #46
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After this years run up I wanted my RMD 's to help rebalance my portfolio .
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Old 01-09-2018, 01:31 PM   #47
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The squeaky wheel gets progress . Vanguard called me today and they expedited it through their system and everything will be fixed by tomorrow and I will get the gains for the days out of the market . They admitted it was a computer error . I am still leery and may move some to Fidelity .Besides complaining to them I did write on their facebook page and that is when they did something to move it along.
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Old 01-09-2018, 01:33 PM   #48
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Addressing the OP's question:

I have half my assets in T Rowe Price. Have been a long time customer and have found them very easy to work with and conscientious with follow-up.

This summer I moved all of my 401k out of my employers accounts to Vanguard and TRP.
Basically I found Vanguard to be a do-it-yourself shop and TRP to be a concierge service.
I am happy with both companies funds but I found transferring money to TRP a lot less nerve racking and easier. They assigned someone to me who would call and let me know the progress, opened funds for me on the phone, and they followed up with calls to let me know when the checks arrived and then cleared. 2 phone calls. At Vanguard you hack away at their website or try to hold the interest of an overworked phone rep long enough to get an approximation of your question answered. They probably have to handle so many calls an hour.

You get what you pay for: Low cost indexed funds - hack away. Higher cost managed finds - soothed nerves and confidence things were done right. After that - the funds returns speak for themselves.
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Old 01-09-2018, 01:33 PM   #49
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Moemg...
Nice move. And, thanks for that information regarding Facebook.
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Old 01-09-2018, 01:41 PM   #50
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My only gripe to date is that the Flagship "benefits' haven't been of any use. Nor is their dashboard, but that is true of other sites too.
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Old 01-09-2018, 01:45 PM   #51
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All the brokerages make mistakes (who doesn't?) but IMO the real test is how they correct them. Similar to another poster's report, TRP made a goof that cost me thousands in taxes, and though they admitted their error TRP refused to cover the cost.
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Old 01-09-2018, 01:53 PM   #52
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The squeaky wheel gets progress . Vanguard called me today and they expedited it through their system and everything will be fixed by tomorrow and I will get the gains for the days out of the market . They admitted it was a computer error . I am still leery and may move some to Fidelity .Besides complaining to them I did write on their facebook page and that is when they did something to move it along.
I find it very convenient to have most assets at one firm. So I'd tolerate quite a bit before complicating things. But then again, having another firm as a resource could have some pluses. Would be interested to hear a followup someday if you decide to do this.

Using their FB page was a stroke of genius. I've never visited any firms FB site. Will have to try it out.
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Old 01-09-2018, 02:07 PM   #53
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For me, the one place that did NOT fix their error (at a cost of thousands to me) was FIDELITY.

Moving from Vanguard to Fidelity is absolutely nuts.
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Old 01-09-2018, 02:25 PM   #54
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Vanguard: I set up DH & my RMDs early on to be executed just before Christmas. I received the notice that DH's executed but not mine, however it did tell me that they sold the proper amount of the fund to pay my RMD. I called to ask about my RMD, the CSR told me that it was in process. Day later no notice so I called again. CSR said the equivalent of OOPS, consulted with the supervisor and it happened before I hung up. That was unsettling.

We were Fidelity clients, maybe I should pay them a visit.

The observation of others about executing RMDs early in the year got me thinking as I am investing our RMDs in our non-retirement account.
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Old 01-09-2018, 02:28 PM   #55
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Stuff happens. It will be fixed. Nothing hurt. With any organization you may have blips. No reason to abandon Vanguard for a for profit firm.

You could have the same thing happen at Fidelity or Schwab.

You could move to Edward Jones or Raymond James. Then this error wouldn't feel like such a big deal.
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Old 01-09-2018, 02:40 PM   #56
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Gotta say I was a little surprised when I heard all the ballyhoo about how some major financial institutions were issuing bonuses in the wake of the big tax cut ... and raising their minimum hourly wage to $15. Geez, a shelf stocker at Aldi makes $11 in my area. .
Local Chic-Fil-A starts people at $13 an hour. And no Sunday work. That sign has been up for months. Obviously, they still have positions to fill.

Sometimes employers think that the law of supply and demand does not apply to workers. Surprise!

Price is a function of Supply and Demand. Not cost, not the CEO's profit goal for the year, not the employees need for more money so she can buy a boat, not some politician's views on the way things should be.

Back on topic. Overall I am happy with Vanguard. The real test of a company's service is how they handle the problems that inevitably will occur when dealing with companies full of fallible humans.
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Old 01-09-2018, 02:47 PM   #57
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If I draw out RMD's at the beginning of 2018 and put it in an investment that generates cap gains, won't they be short term gains if needed for spending? I think short term gains are taxed at ordinary income levels. In our case we will want those RMD's for spending. So I guess this depends on one's income spending streams.
But if you are intending to spend the money within the year a money market or short term fund / bank account might make more sense where all the returns are ordinary income. (much less to zero risk of loosing principal)
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Old 01-10-2018, 02:33 AM   #58
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DH just took a distribution at Fidelity, and did it online. But our "joint" checking account was rejected for ACH deposit and had to get the check mailed. Yuck.

To avoid a problem, he can have IRA distributions go to a Fidelity brokerage or cash account, then transfer to an external account.
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Old 01-10-2018, 05:38 AM   #59
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I have been with VG for 35 years, with never a problem.

For a laugh I posted my broken VG coffee mug on FB and they sent me a new one. Social media gotta love it.
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Old 01-10-2018, 07:10 AM   #60
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DH just took a distribution at Fidelity, and did it online. But our "joint" checking account was rejected for ACH deposit and had to get the check mailed. Yuck.
Hmmmm - I guess your checking account wasn’t pre-linked at Fidelity then. I have several external accounts linked at Fidelity making ACH transfers very easy. I also have a Fidelity cash management account that would be good for initially receiving a distribution and funds can be sent from there to a variety of external accounts.
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