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72T over time-Balance
Old 12-08-2023, 08:50 PM   #1
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72T over time-Balance

Curious if any long time posters care to share their experience in their 72T balance over time.
I've done extensive research on the subject and feel comfortable starting one just wondering what balances over time do.
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Old 12-09-2023, 07:48 PM   #2
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I retired in Oct 2006 at 48 and immediately started 72t withdrawals (recalc method) from my 100% stock portfolio. By the time I ended them in Jan 2018 when I turned 59.5 my balance was up a little over 60%. I withdrew a total of 54% of my original balance.
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Old 12-09-2023, 08:13 PM   #3
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It'll depend on lots of factors.

What the 72(t) account is invested in.

When the person did the 72(t) program.

What they chose for method and interest rate.

If RMD method, how old they were.

If they switched methods, when they switched and what the balance was.

How long they did the 72(t) for.

On average most folks probably did OK, because anyone sophisticated enough to try a 72(t) probably understands things pretty well.

One can always switch to the RMD method, and there are no longer penalties for a 72(t) program where the 72(t) balance goes to zero. So that's nice from a tax point of view, and means there's no drawback otherwise to starting a 72(t) - there's still the issue of running out of money of course.

I considered a 72(t) for next year since I just turned 54.5 last month. I decided against it; there's a thread I started if you're interested in the details of that thought process.
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Old 12-10-2023, 06:54 AM   #4
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Quote:
Originally Posted by CyclingInvestor View Post
I retired in Oct 2006 at 48 and immediately started 72t withdrawals (recalc method) from my 100% stock portfolio. By the time I ended them in Jan 2018 when I turned 59.5 my balance was up a little over 60%. I withdrew a total of 54% of my original balance.
Thank you sir, appreciate it.
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Old 12-10-2023, 07:42 AM   #5
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Quote:
Originally Posted by CyclingInvestor View Post
I retired in Oct 2006 at 48 and immediately started 72t withdrawals (recalc method) from my 100% stock portfolio. By the time I ended them in Jan 2018 when I turned 59.5 my balance was up a little over 60%. I withdrew a total of 54% of my original balance.

I anticipate similar results. While I haven't started yet, I will do RMD method starting sometime in my early-mid 50's (depends on depletion of my taxable/cash needs/and future RMD concerns (taking sooner to avoid higher brackets later when RMDs are required)). At that age the WDR would be well below 4% of the current balance which is more conservative than 4% of starting balance with inflation adjustment that statistically is likely to leave a larger balance.
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Old 12-27-2023, 02:36 PM   #6
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Originally Posted by SecondCor521 View Post
It'll depend on lots of factors.
I considered a 72(t) for next year since I just turned 54.5 last month. I decided against it; there's a thread I started if you're interested in the details of that thought process.
Can you link your other thread?
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Old 12-27-2023, 03:13 PM   #7
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When the 7 year Treasury was 5% not that long ago, I considered putting my Trad IRA into a 7 year Treasury and then using 4.5% for my withdrawal rate.

With mostly stocks you may or may not end up with more or less money after the 72t period. 5-7 years, stocks are not guaranteed to do anything.

I decided to work another year. Now Treasury rates are dropping like a stone again, so who knows what the future will bring.
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Old 12-27-2023, 07:48 PM   #8
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Can you link your other thread?
Sure:

https://www.early-retirement.org/for...ne-119894.html
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