Unfortunately, the RMD must still be taken in 2008 (people 70 1/2+ have till 31 Dec to take the distro). That's a hit, considering how much more IRAs and retirement accounts were worth as of 31 Dec 2007 (which the RMD is based on).
I still have a few years 'til RMDs. I haven't studied the subject thoroughly yet, but Amethyst makes me think of a strategy to consider. It would seem prudent to split IRAs and 401(k)s, etc. into "pots" of money which give flexibility for cashing out when RMDs will be due. In the case Amythyst mentions, it seems you could be forced to sell a relatively larger amount of your now less valuable stocks portfolio to satisfy RMDs. This situation would argue for keeping a significant portion of IRA (etc.) money in some sort of cash-like account. In years like this, you could use money from that account for RMDs. In years of good stock results, you could redeem stock accounts to refill cash acct. and/or pay RMDs to yourself.
I'm sure this is something you all have discussed before and have already figured out a strategy for. I'm late to the party, so I'm just now thinking it through for the near future. If I'm wrong, I'd prefer to find out now. Any thoughts on RMD strategy or can anyone direct me to an old thread? I'm still learning to use the search function - not always with the best of results!
RMDs sound like a real pain. Still, having to deal with RMDs would indicate that you have a chunk of assets. Guess that's the silver lining.
