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Heres where i screwed up
Old 07-15-2016, 03:10 AM   #1
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Heres where i screwed up

I could have done 401k to Roth conversions, at 15% tax, 10 years sooner. When I retired we dropped into the 15% bracket. I didn't think about moving anything anywhere till RMD time. Then, at age 70, I noticed the 25% bracket lurking ahead and said "Oh, I better do some Roth conversion. I can still do the roth conversions till DW turns 70, but I think I missed out of converting about 100k. 25% lurks ahead and will be unavoidable when DWs RMD & Social security kicks in.

The other way I screwed up was taking Social security at 62 in response to a $400 pension reduction. It would have been easy to wait four more years to my FRA when DW retired my social security would be needed. So my social security is reduced forever cus I didn't want to look for a way to adjust to that -$400 for four years.

We're doing fine in spite of my errors. Just the 2 pensions and my social security meet our needs but I can see where i could have done a better job with this stuff.
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Old 07-15-2016, 03:55 AM   #2
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The other way I screwed up was taking Social security at 62 in response to a $400 pension reduction. It would have been easy to wait four more years to my FRA when DW retired my social security would be needed. So my social security is reduced forever cus I didn't want to look for a way to adjust to that -$400 for four years.
This one probably isn't a big deal. Presumably you kept more invested because you took SS. The stock market has done well over the past 4 years, so depending on how you had it invested you may always stay ahead with the extra market returns.
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Old 07-15-2016, 05:24 AM   #3
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As they say "don't be thatguy" (sorry, couldn't resist)

Seriously, I don't see anything fatal here. I think everyone has made some slip-up along the way but we all seem to get to the relative same place.

Lots of things I should've done differently but after back-calculating everything, it really didn't come out that much out of line. It sure didn't change my RE date nor my lifestyle.

Mr Market sort of made up for my shortsightedness!
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Old 07-15-2016, 12:15 PM   #4
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The idea of spending 401k money early to enable delaying social security till age 70 was alien to me at 62. I really wouldn't have needed the spend down until 66 ,when we were both retired. (DW retired at 55) So for 4 years of withdrawals I could have maxed out social security.
I wonder if a financial planner would have seen in 2001 what I can see looking back now, and if I would have believed him.

We are far too much in stock funds, so it grows, but it stumbles. I wanna meet a milestone before I cut back. Probably not smart.

I've used the same username too many places. I wanted a new one for here. I'm not very creative. "thatguy" worked.
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Old 07-15-2016, 02:23 PM   #5
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The other way I screwed up was taking Social security at 62 in response to a $400 pension reduction.
.
You might run your situation through FireCalc or others. I ran my brother's data through and found he was slightly ahead of the game taking SS at 62 vs FRA or 70. YMMV.

Maybe you didn't screw up at all.
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Old 07-15-2016, 03:09 PM   #6
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The idea of spending 401k money early to enable delaying social security till age 70 was alien to me at 62. I really wouldn't have needed the spend down until 66 ,when we were both retired. (DW retired at 55) So for 4 years of withdrawals I could have maxed out social security.
I wonder if a financial planner would have seen in 2001 what I can see looking back now, and if I would have believed him.

.....
I suspect an Financial Planner would suggest to everyone to take SS at 62, because that leaves more 401K/IRA/investments available for the Financial Planner to "invest" in funds and earn their blood money commission.
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Old 07-16-2016, 09:41 PM   #7
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I messed up last year. Now I have to do my conversions all at once next year. More costly than it could have been but still better than the Tax Torpedo (esp for the survivor). Q.v.

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Old 07-16-2016, 10:57 PM   #8
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To the OP: Please don't beat yourself up over that. If you run the different options thru Firecalc (or any other well designed retirement calculator) it soon becomes apparent that these are minuscule differences of multiple assumptions that over a 20-30 year retirement amount to a pile of nonsensical bovem dung.
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Old 07-17-2016, 07:24 AM   #9
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Consider that the past 10 years included a rapid increase in the market (after the 2009 crash).

It might be possible that the $15,000 you did not pull out of the market for taxes has grown more than the $25,000 you owe now.
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Old 07-18-2016, 11:45 AM   #10
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I stuck all my yearly tax deferred retirement contributions in a spreadsheet column with a sum at the bottom

I made a hypothetical column of roth contributions, reduced be yearly fed tax rates.
The total of Roth contributions is 26.46% less than the total of pretax contributions.

To estimate todays hypothetical roth balance. If I multiply the Roth contribution total by the ratio of todays pretax balance to the total of actual contributions, it is still 26.46% less.

The earliest hypothetical roth contributions were reduced by the highest tax rates. With lesser amounts compounding from the beginning I suspect that my way of estimating todays Roth balance is generous.
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