Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 04-13-2016, 09:06 PM   #21
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Brat's Avatar
 
Join Date: Feb 2004
Location: Portland, Oregon
Posts: 5,914
If you are a Vanguard client you can direct them to disburse out of Wellesley any balance of your MRD the last week in December automatically.
__________________

__________________
Duck bjorn.
Brat 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 04-13-2016, 10:32 PM   #22
Thinks s/he gets paid by the post
redduck's Avatar
 
Join Date: Mar 2005
Location: yonder
Posts: 2,059
Quote:
Originally Posted by ERD50 View Post
More seriously, one could just forget or get distracted. I kind of like the idea of setting up a withdraw at the start of the year, to be taken out on a pre-determined date.
Quote:
Originally Posted by REWahoo View Post
Which one could also just forget or get distracted.

"A memory is a terrible thing to lose..."
Actually, it can be a "set and forget." My RMD's are set for once a year, same date each year and it's all automatic. The only thing I have to remember is to have enough cash in the accounts for this to work properly. I currently have enough cash for the next 3-4 years. Therefore, I have a free pass to be forgetful and/or distracted for the next 6-8 years.
__________________

__________________
Carpe cōleī
redduck is offline   Reply With Quote
Old 04-14-2016, 12:48 AM   #23
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
youbet's Avatar
 
Join Date: Mar 2005
Location: Chicago
Posts: 9,965
Quote:
Originally Posted by ERD50 View Post
Sounds good, but someone on this forum keeps reminding us that "Numbers is hard." And I suspect they will just get harder as I reach RMD age (which Fidelity keeps calling "MRD", and they seem to be the exception?). Add up all the divs, then subtract that from your RMD - oh no, maths!

More seriously, one could just forget or get distracted. I kind of like the idea of setting up a withdraw at the start of the year, to be taken out on a pre-determined date.



I wasn't sure if brokers had a set % (X% or nothing?) or if they would all take input from you.
I don't know about all brokers and 401k admins, but Schwab told me that if I want anything withheld from an IRA distribution (RMD or otherwise), I'll need to provide a number in dollars (as opposed to percentages, filing status, number of dependents, etc.). It sounds like they don't want to be in the tax business. They will calculate the amount I need to withdraw to meet gov rules though. The withholding would be part of the withdrawal.
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
youbet is offline   Reply With Quote
Old 04-14-2016, 01:13 AM   #24
Thinks s/he gets paid by the post
redduck's Avatar
 
Join Date: Mar 2005
Location: yonder
Posts: 2,059
Quote:
Originally Posted by youbet View Post
I don't know about all brokers and 401k admins, but Schwab told me that if I want anything withheld from an IRA distribution (RMD or otherwise), I'll need to provide a number in dollars (as opposed to percentages, filing status, number of dependents, etc.)....
You might want to ask Schwab again. As I recall, they ask for a percentage regarding Federal withholding. The rules are bit different regarding State withholding, but percentages are still used.
__________________
Carpe cōleī
redduck is offline   Reply With Quote
Old 04-14-2016, 02:05 AM   #25
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
youbet's Avatar
 
Join Date: Mar 2005
Location: Chicago
Posts: 9,965
Quote:
Originally Posted by redduck View Post
You might want to ask Schwab again. As I recall, they ask for a percentage regarding Federal withholding. The rules are bit different regarding State withholding, but percentages are still used.
I can do that.

Have you made IRA withdrawals where they wouldn't accept your request to have a specific dollar amount withheld?
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
youbet is offline   Reply With Quote
Old 04-14-2016, 06:57 AM   #26
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Gone4Good's Avatar
 
Join Date: Sep 2005
Posts: 5,381
Stock markets tend to go up more often than they go down. Therefore getting your money into the market as early as possible will be the best option over time when building the portfolio. So during the withdrawal phase, leaving your money in as long as possible and delaying your RMD until the end of the year should work to your advantage more years than not.

Of course volatility works against you during deaccumulation. So maybe the right answer is to sell out of Wellesley in the IRA completely and swap it for something in your AA that is less volatile. That leaves your Wellesley allocation to do it's thing without worry of needing to sell at inopportune times.
__________________
Retired early, traveling perpetually.
Gone4Good is offline   Reply With Quote
Old 04-14-2016, 07:18 AM   #27
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
braumeister's Avatar
 
Join Date: Feb 2010
Location: Northern Kentucky
Posts: 8,603
Most of you probably know this, but if you take the RMD in December and have taxes withheld from it, there is another advantage. The tax amount is deemed to have been withheld evenly throughout the year. That can save you from bothering with sending in estimated taxes.
__________________
braumeister is online now   Reply With Quote
Old 04-14-2016, 07:26 AM   #28
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
donheff's Avatar
 
Join Date: Feb 2006
Location: Washington, DC
Posts: 8,643
Not sure I see this issue as any different than the many discussions we have had about when to make portfolio withdrawals in general. Many people do it all at one annual point. e.g. accumulate and then pull distributions, sell additional shares of the most appreciated assets, re-balance to desired AA, rinse and repeat next year. Others do it over the course of the year. Some of us play a little bit of timing, trying to guess when we have gotten a significant climb and liquidating equities then.

The only difference I can see with RMDs is that they may exceed your needed funds for expenses in which case you simply invest the excess in taxable. For tax reasons, I plan to invest excess RMDs in equity indexes increasing the bond holdings in 401ks to maintain the proper AA.
__________________
Every man is, or hopes to be, an Idler. -- Samuel Johnson
donheff is offline   Reply With Quote
Old 04-14-2016, 07:57 AM   #29
Thinks s/he gets paid by the post
 
Join Date: Oct 2008
Location: Naples
Posts: 2,161
Quote:
Originally Posted by braumeister View Post
Most of you probably know this, but if you take the RMD in December and have taxes withheld from it, there is another advantage. The tax amount is deemed to have been withheld evenly throughout the year. That can save you from bothering with sending in estimated taxes.
I think I'll use this "excuse" or "reason" to just delay my RMD until December each year. We don't need or use these RMD's to live on due to my pension and our Social Security. As I said in initial post, I only take the RMD because I have to and then I usually stick it in another account. I like Wellesley and have another taxable account at Vanguard. I can change that fund to an Admiral for the lower expense. I think I'll set up an automatic withdrawal from the IRA to the taxable account on December first each year. This satisfies the RMD, takes care of the estimated tax problem and would probably cover the hopeful increase in value toward the end of the year.

Thanks for all the information provided. Through discussions like this, you can see how valuable the site can be.
__________________
JOHNNIE36 is offline   Reply With Quote
Old 04-14-2016, 09:01 AM   #30
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Sep 2005
Location: Northern IL
Posts: 18,281
Quote:
Originally Posted by redduck View Post
Quote:
Originally Posted by ERD50 View Post
More seriously, one could just forget or get distracted. I kind of like the idea of setting up a withdraw at the start of the year, to be taken out on a pre-determined date.
Quote:
Originally Posted by REWahoo View Post
Which one could also just forget or get distracted.

"A memory is a terrible thing to lose..."
Actually, it can be a "set and forget." My RMD's are set for once a year, same date each year and it's all automatic. The only thing I have to remember is to have enough cash in the accounts for this to work properly. I currently have enough cash for the next 3-4 years. Therefore, I have a free pass to be forgetful and/or distracted for the next 6-8 years.
Right - redduck's response is along the lines of what I was thinking. Not a big deal either way, but I'd just be more likely to have things go smoothly if I scheduled a 4th Q RMD withdraw in January when I got my EOY statement and RMD calculation, or set it when I do my taxes and am thinking of these things. And if I forget then, I've got all year as a back up.

If I wait until after the last div payment, that could mean having to get it done the last 2 weeks of December, when a lot of other things are going on. It certainly can be done, not that tough at all, and it makes some sense. I just find that I prefer to have things set ahead so I can forget them, and not need to tend to something on a tighter schedule if it is easily avoided.

-ERD50
__________________
ERD50 is offline   Reply With Quote
Old 04-14-2016, 09:29 AM   #31
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Sep 2005
Location: Northern IL
Posts: 18,281
Quote:
Originally Posted by youbet View Post
I don't know about all brokers and 401k admins, but Schwab told me that if I want anything withheld from an IRA distribution (RMD or otherwise), I'll need to provide a number in dollars (as opposed to percentages, filing status, number of dependents, etc.). It sounds like they don't want to be in the tax business. They will calculate the amount I need to withdraw to meet gov rules though. The withholding would be part of the withdrawal.
I just realized that could be used to simplify things (assuming other brokers allow the customer to set the $ or % withholding). Assuming your RMDs are as large as your total taxes, one could set quarterly RMD payments, and set the withholding to add up to > 90% of the previous year's tax.

Then you would not have to fiddle with estimated payments. Again, not a big deal, but I like simple when I can.

-ERD50
__________________
ERD50 is offline   Reply With Quote
Old 04-14-2016, 10:26 AM   #32
Thinks s/he gets paid by the post
 
Join Date: Nov 2011
Posts: 2,364
An argument for early-in-the-year withdrawal from a tIRA is a reduction in ordinary income taxes. Money left in a tIRA generates dividends that will be taxed at ordinary rates rather than at the lower rate of tax on dividends.
__________________
GrayHare is offline   Reply With Quote
Old 04-14-2016, 10:43 AM   #33
Thinks s/he gets paid by the post
redduck's Avatar
 
Join Date: Mar 2005
Location: yonder
Posts: 2,059
Quote:
Originally Posted by youbet View Post
I can do that.

Have you made IRA withdrawals where they wouldn't accept your request to have a specific dollar amount withheld?
No, I haven't ever requested a specific dollar amount withheld.

With my two IRA's (one with Schwab) I have only used a percentage, never a specific dollar amount withheld. I only take out RMD money once a year for both State and Federal.

Maybe you can download "Schwab's IRA Required Minimum Distribution Request Form (apparently that's what I did a few years ago) and it's all there.

I am looking at Schwab's Tax Withholding Election section on page 4 of the above mentioned form: "I want federal tax withheld at the rate of _____%." It doesn't have the option of putting in a specific dollar amount. Same deal for state tax.

However, since you can put in a percentage from 10 to 99 (for federal withholding), you can probably get pretty close to the dollar amount you want.
__________________
Carpe cōleī
redduck is offline   Reply With Quote
Old 04-14-2016, 10:43 AM   #34
Thinks s/he gets paid by the post
DrRoy's Avatar
 
Join Date: Dec 2015
Location: Michigan
Posts: 1,723
Just work up a standard distribution schedule and stick to it. Getting into market timing is a slippery slope.
__________________
"The mountains are calling, and I must go." John Muir
DrRoy is offline   Reply With Quote
Old 04-14-2016, 04:13 PM   #35
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
mickeyd's Avatar
 
Join Date: Apr 2004
Location: South Texas~29N/98W
Posts: 5,881
Flip a coin. Heads~ Take it now- Tails~ Take it later.

RMD is a requirement to pay taxes, not a requirement to spend.

As for me, I take RMD in December just because...
__________________
Part-Owner of Texas

Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx

In dire need of: faster horses, younger woman, older whiskey, more money.
mickeyd is offline   Reply With Quote
Old 04-14-2016, 04:50 PM   #36
Full time employment: Posting here.
misanman's Avatar
 
Join Date: Apr 2008
Posts: 536
My understanding is that RMDs must be satisfied for the year before Roth conversions are allowed. Could be a factor for some.

Sent from my XT1575 using Early Retirement Forum mobile app
__________________
"The best thing about the future is that it happens one day at a time." -- A. Lincoln
misanman is offline   Reply With Quote
RMD
Old 04-14-2016, 05:12 PM   #37
Thinks s/he gets paid by the post
Souschef's Avatar
 
Join Date: Dec 2015
Location: Santa Paula
Posts: 1,186
RMD

I have 3 IRA's, and have one spreadsheet for RMD's. I downloaded the chart from the IRS. I plug in the Dec 31 balance for the IRA's and my spreadsheet calculates the amount every year. Then I annotate what I am doing,e.g transferring shares to regular account, QCD's or taking part of the proceeds.
__________________
Retired Jan 2009 Have not looked back.
AA 95%/0/5
WR 2% SI 2SS & 2 Pensions
Souschef is offline   Reply With Quote
Old 04-14-2016, 05:14 PM   #38
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
youbet's Avatar
 
Join Date: Mar 2005
Location: Chicago
Posts: 9,965
Quote:
Originally Posted by ERD50 View Post
I just realized that could be used to simplify things (assuming other brokers allow the customer to set the $ or % withholding). Assuming your RMDs are as large as your total taxes, one could set quarterly RMD payments, and set the withholding to add up to > 90% of the previous year's tax.

Then you would not have to fiddle with estimated payments. Again, not a big deal, but I like simple when I can.

-ERD50
Yes, and that's pretty much my plan.

Right now I do quarterly estimated tax payments. When DW starts RMD's in 2017, I'm planning on stopping estimated payments and having that amount plus the amount needed to cover the RMD withdrawal taken out of the RMD withdrawal as withholding in December.

You don't need to set quarterly RMD payments, just do it in Dec. Unlike estimated payment, withholding doesn't have to be "timely." You can withhold your entire year's tax obligation on Dec 31st.
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
youbet is offline   Reply With Quote
Old 04-14-2016, 05:24 PM   #39
Thinks s/he gets paid by the post
Eagle43's Avatar
 
Join Date: Jan 2005
Location: DFW
Posts: 1,883
I take RMD in 3rd week of December and ask Vanguard to withhold 20%. Since I don't need it, the after-tax remainder is invested in Target Retirement Income.

Sent from my SM-T810 using Early Retirement Forum mobile app
__________________
Resist much. Obey Little. . . . Ed Abbey

Disclaimer: My Posts are for my amusement only.
Eagle43 is offline   Reply With Quote
Old 04-14-2016, 07:38 PM   #40
Recycles dryer sheets
 
Join Date: Mar 2014
Posts: 257
Glad you have Wellesley and not DH's TIAA-CREF which has screwed up the RMD distribution 2 times. I swear, they are the most incompetent I have seen.


Sent from my iPhone using Early Retirement Forum
__________________

__________________
iac1003 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
What do you do about Minimum Retirement ages Required by Pensions?? militaryman Hi, I am... 10 05-03-2016 08:33 PM
Minimum Required Distribution to roth ? bobbee25 FIRE and Money 7 09-16-2014 05:32 AM
Minimum Required Distributions ? Brat FIRE and Money 11 02-03-2011 10:54 AM
Minimum required credit score for a military officer? Sam Other topics 14 01-26-2010 11:34 AM
Financial Math Wizards Required nwsteve FIRE and Money 7 02-20-2005 03:53 PM

 

 
All times are GMT -6. The time now is 06:37 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.