Cameraman1280
Confused about dryer sheets
Hello All: I’m new to the forum. I discovered this forum a few months ago and thought I would join to learn from the wealth of knowledge I have read about in the various forums.
I’m 65, and recently retired from my job of 38 years. I do not have many assets, except my 401K = 1.2M, company pension = 3800/month (before taxes), and 100K in a rainy day fund. I’m not taking SS yet. My house will be paid off within 6 months. I would like your thoughts and suggestions on my early retirement problem, I’m trying to solve. I have a Fidelity consultant helping me with my 401K management. I not taking Social Security until I turn 70, so, I want to live on just my pension, that I get from my past employer. It’s not a lot of money, but I can live frugally until I start taking SS. I figured out my total yearly retirement expenses are around 48K. I told my Fidelity consultant that I wanted to take out 20K each year from my 401K to supplement my yearly expenses and pay for my hybrid LTC insurance payments, until I start taking SS payments. Before receiving any money from my 401K, my Fidelity consultant asked me If I wanted to do a Net Unrealized Appreciation (NUA) on some of my company stock in my 401K. I did not know anything about NUA. He explained it and I read several articles on this process. From my first learning of this process, I asked why would I want to get rid of my company stock; it’s doing well. Just to make a general statement: looking at what’s going on in the world today, it ain’t going down. My Fidelity consultant said that rolling over a percentage of company stock, would lower my income when I had to do RMD’s in the future. He also said that the income from my dividends from my rolled over company stock could help pay for some of my LTC payments. I found an on-line NUA calculator and ran some numbers on various percentages of company stock to roll over. I looked at the amount of taxes (Federal and State) that would have to be paid out for the various percentages. Then thought, where am I going to get the money to pay the taxes for this NUA? The Fidelity consultant suggested that I use my rainy day fund money, that I have been saving for years. To accumulate that little rainy day fund, I did not go on any vacations, and all of my yearly tax refunds were saved. I deprived myself to save this money. If there is a household repair or health emergency or replacement car, I have something to fall back on. I’m no longer working to replenish this fund. I do not want to risk loosing any of my fund. Without it, I would sort of feel like a man walking a tight rope without a net. Would it be better to do small Roth IRA conversions every year to lower my RMD income (taking out extra money from my 401k to pay the taxes on the Roth IRA conversion amounts). I would appreciate any helpful thoughts or suggestions on my situation. Thanks
I’m 65, and recently retired from my job of 38 years. I do not have many assets, except my 401K = 1.2M, company pension = 3800/month (before taxes), and 100K in a rainy day fund. I’m not taking SS yet. My house will be paid off within 6 months. I would like your thoughts and suggestions on my early retirement problem, I’m trying to solve. I have a Fidelity consultant helping me with my 401K management. I not taking Social Security until I turn 70, so, I want to live on just my pension, that I get from my past employer. It’s not a lot of money, but I can live frugally until I start taking SS. I figured out my total yearly retirement expenses are around 48K. I told my Fidelity consultant that I wanted to take out 20K each year from my 401K to supplement my yearly expenses and pay for my hybrid LTC insurance payments, until I start taking SS payments. Before receiving any money from my 401K, my Fidelity consultant asked me If I wanted to do a Net Unrealized Appreciation (NUA) on some of my company stock in my 401K. I did not know anything about NUA. He explained it and I read several articles on this process. From my first learning of this process, I asked why would I want to get rid of my company stock; it’s doing well. Just to make a general statement: looking at what’s going on in the world today, it ain’t going down. My Fidelity consultant said that rolling over a percentage of company stock, would lower my income when I had to do RMD’s in the future. He also said that the income from my dividends from my rolled over company stock could help pay for some of my LTC payments. I found an on-line NUA calculator and ran some numbers on various percentages of company stock to roll over. I looked at the amount of taxes (Federal and State) that would have to be paid out for the various percentages. Then thought, where am I going to get the money to pay the taxes for this NUA? The Fidelity consultant suggested that I use my rainy day fund money, that I have been saving for years. To accumulate that little rainy day fund, I did not go on any vacations, and all of my yearly tax refunds were saved. I deprived myself to save this money. If there is a household repair or health emergency or replacement car, I have something to fall back on. I’m no longer working to replenish this fund. I do not want to risk loosing any of my fund. Without it, I would sort of feel like a man walking a tight rope without a net. Would it be better to do small Roth IRA conversions every year to lower my RMD income (taking out extra money from my 401k to pay the taxes on the Roth IRA conversion amounts). I would appreciate any helpful thoughts or suggestions on my situation. Thanks