My first IRA withdrawal

[dm]

As the title says, I withdrew from my IRA for the first time. I ERed in 2007 @ 50 and hoped to not need to withdraw till at least 62, which would be next May.

We bought a couple of new cars this year and are redoing the floors in the house. Also I did not plan on getting my pilots license and buying a plane. I also didn’t plan on moving to Florida and paying more for the new house than the one we sold.

I converted my 401k to the IRA and of coarse it has grown quite a bit over the last 11 years.

But after all those years of saving it still hard to make a withdrawal. Even if it’s only $5,000.

 

[RetireBy90]

I must grieve with you. I will be done with the job on Friday and am anxious about the draws from retirement savings. After 40+ years of saving what we could the saving habit is part of my makeup. I understand it is time for me to start drawing from the savings but hard for me to be comfortable doing this. Hoping I can limit my draws to the gains from the previous year or less but even that is hard to be comfortable with.

I'd love to hear any advice on how to be more comfortable. I'm sure after a couple years of this I'll be less anxious but in the meantime

 

[Newventurer]

As the title says, I withdrew from my IRA for the first time. I ERed in 2007 @ 50 and hoped to not need to withdraw till at least 62, which would be next May.

We bought a couple of new cars this year and are redoing the floors in the house. Also I did not plan on getting my pilots license and buying a plane. I also didn’t plan on moving to Florida and paying more for the new house than the one we sold.

I converted my 401k to the IRA and of coarse it has grown quite a bit over the last 11 years.

But after all those years of saving it still hard to make a withdrawal. Even if it’s only $5,000.

There are a lot of pretty significant (to me) ‘didn’t plan tos’ in your story...and it’s the $5k withdrawals that keep you up at night?

 

[REWahoo]

You are looking at this backwards. Heck, you spent decades saving and investing, building up enough resources to support you and allow you to stop working. You paid your dues and now that you are reaping the rewards you should celebrate!

I actually enjoyed taking my first withdrawal. After 30+ years of building up our nest egg it was great to be able to actually start using it.

 

[street]

I understand your feelings. When it comes WD from the 401K or IRA I will feel the same way.

 

[ERD50]

you are looking at this backwards. Heck, you spent decades saving and investing, building up enough resources to support you and allow you to stop working. You paid your dues and now that you are reaping the rewards you should celebrate!

I actually enjoyed taking my first withdrawal. After 30+ years of building up our nest egg it was great to be able to actually start using it.

+1

-erd50

 

[NW-Bound]

...But after all those years of saving it still hard to make a withdrawal. Even if it’s only $5,000.

You will get used to it. $5K is of course only the start.

For me, it already hurt taking money from my after-tax investment accounts (several hundred $K to live on), so there's no difference when I ran them down and had to switch to IRA.

 

[Bamaman]

You have done very well to put off any withdrawal this long. The money is there to spend. Show no guilt.

We are facing some small RMDs even we don't need the $ for quite sometime. My wife is a little older.

 

[kgtest]

But after all those years of saving it still hard to make a withdrawal. Even if it’s only $5,000.

DF is havinv a tough time with the idea of withdrawals. Lucky for him RMD will force him to take some in a few years. Although his plan is to plow it right back into the market.

I keep telling him he doesn't want to be the richest guy in the graveyard, but he doesn't seem to get it.

 

[NW-Bound]

You will get used to it. $5K is of course only the start.

For me, it already hurt taking money from my after-tax investment accounts (several hundred $K to live on), so there's no difference when I ran them down and had to switch to IRA.

Just occurred to me: if one does not withdraw money from savings, whether before or after-tax accounts, then what does he live on? Pension? Or an after-tax account large enough that he can live on its dividend payout?

I don't have the above, and I suspect most ERs do not either. Even when SS starts, it is not enough for the lifestyle that most people want.

 

[candrew]

You are looking at this backwards. Heck, you spent decades saving and investing, building up enough resources to support you and allow you to stop working. You paid your dues and now that you are reaping the rewards you should celebrate!

I actually enjoyed taking my first withdrawal. After 30+ years of building up our nest egg it was great to be able to actually start using it.

^^^^

What he said!

 

[dm]

Just occurred to me: if one does not withdraw money from savings, whether before or after-tax accounts, then what does he live on? Pension? Or an after-tax account large enough that he can live on its dividend payout?

I don't have the above, and I suspect most ERs do not either. Even when SS starts, it is not enough for the lifestyle that most people want.

My wife has her teachers pension and we have been drawing from after tax accounts. So we have been making some withdraws, just not from the IRA. I was hopeing to make it till I could draw SS.

For some reason it’s just different pulling from the IRA. And of coarse there is the taxes.

 

[dm]

There are a lot of pretty significant (to me) ‘didn’t plan tos’ in your story...and it’s the $5k withdrawals that keep you up at night?

The flying bug definatly threw things off, but I had plenty of cushion. And I probably won’t be flying 10-15 More years. And I can always sell the plane. I did plan for one new car and was hopeing to get one more year out of the other one. But engine problems caused early replacement.

I was thinking with SS at 62 along with the wife’s pension and a few other investments we would not have to touch the IRA. Unless we wanted a boat or other necessities.

 

[dtbach]

You are looking at this backwards. Heck, you spent decades saving and investing, building up enough resources to support you and allow you to stop working. You paid your dues and now that you are reaping the rewards you should celebrate!

I actually enjoyed taking my first withdrawal. After 30+ years of building up our nest egg it was great to be able to actually start using it.

+++


You put your part of your salary into the investments. Now they are your new "salary". Enjoy knowing you have done a great job!!!!

 

[dm]

You are looking at this backwards. Heck, you spent decades saving and investing, building up enough resources to support you and allow you to stop working. You paid your dues and now that you are reaping the rewards you should celebrate!

I actually enjoyed taking my first withdrawal. After 30+ years of building up our nest egg it was great to be able to actually start using it.

I know, but it just feels different. We are still living below our means, and the net worth is still going up. And I feel we really should start spending a little more while we are still healthy. But we do pretty much what we want now.

 

[Crabby Mike]

DF is havinv a tough time with the idea of withdrawals. Lucky for him RMD will force him to take some in a few years. Although his plan is to plow it right back into the market.

That's the way I'm planning to treat mine (at least for now; they're still 5 years away). Take the RMD, use a portion to pay the taxes, and put the rest back to work. Our plan all along has been to live on income only, and preserve principal for the kids (or for us later if we need it). RMDs aren't income, but rather forced withdrawals of principal.

 

[GravitySucks]

I also recently made my first IRA withdrawl.
Even though the last 5 +years withdrawal came from a 401k that's now gone (almost as planned, market gains have me an extra 6 months), it felt disconcerting to draw down on the IRA. Feels like I'm at the point where I'm withdrawing out of that permanent fund now. No real difference but an emotional hit anyway.

 

[copyright1997reloaded]

I'm annoyed that I haven't been able to do a distribution. I retired at 51 with the intention of doing a SEPP. Then I ended up consulting part time. Then I ended up teaching part time. Then I ended up teaching full time. Now I'm worried about painful tax consequences on RMD's if I don't start withdrawing money.

Yes, I know it is a first-world problem to have. If I wasn't having so much fun teaching,I'd be celebrating the first IRA or 401K distribution.

 

[jkern]

I feel the same way. Retired in 09' at 51, made my first withdrawal a few months ago at age 60 ($16K). I'm making three smallish withdrawals starting this year, then next year and the year after to fund a few projects I want to do. Doing it over three years works out better tax wise.

 

[RobbieB]

I'm looking forward to taking my first fat withdrawal from the IRA and blowing it on some international travel first class all the way -

 

[texcurtis]

I retired early at 54. Now at 58, I just took my first retirement savings withdrawal to buy a new car & do some home repairs I’ve been putting off.

Mr market has been so good since I retired that I’m above what my original plan was. I decided to pull the trigger with the withdrawal & also initiate monthly withdrawals as well.

It took some emotional soul searching to decide I was worth spending the money, even when I knew the money is there to be used. Much tougher than I thought it would be. Feeling grateful.

 

[jollystomper]

I'm looking forward to my first 401K/IRA withdrawal. I cannot do it this year because of the tax implications, but come January first I can't wait to get my grubby little hands on some of the funds.

 

[gayl]

I more than 'get it.' But I just ran the what-ifs on an RMD calculator. The difference between taking 6 to 8k a year now versus letting everything grow until 70.5 winds up to be only about $600 a year less? I mean I do believe the Vanguard calculator but waste all of this mental energy on $600 a year seems a little bit ridiculous to me. Still it's a big shift from being a saver to a Spender and something that I'm glad to hear others struggle with as well

 

[lem1955]

I had a hard time the first year of retirement taking 3.72% of my portfolio. It got easier after that because it grew so much more than the withdrawal. I'm looking at income that is nearly double what I'm taking now when I turn 70 - between RMD's on my own portfolio and an inherited IRA, social security, and an inherited real estate partnership, so I'm not feeling stingy about what I have now. Giving some money to kids and grandkids, traveling, doing home improvements, and enjoying life. My mother died in January and it's clearer than ever that you can't take it with you.

 

[NW-Bound]

Quicken shows that last year I withdrew and spent 3.1% of the balance on 1/1/2017. That's a small part of the 20+% growth last year. No pension, no SS yet, nothing... Nice!

Now, will the market god be so nice to give that again and again? I seriously doubt it.

This year, I withdrew and spent 1.7% so far. The WR is smaller in percentage, because my stash is getting bigger. Enjoy watching it while it lasts, I guess.

Still don't feel the need to blow any more dough than enough to make me happy.