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11-12-2009, 06:16 PM
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#1
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Recycles dryer sheets
Join Date: Feb 2008
Posts: 106
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Accessing the Loot!
Hi all,
One of the things I've come to love about this forum is that you guys are all such good planners. (And also that it's one of the few places where frugality is considered a virtue instead of a character flaw!)
Today, I've gotten my first inkling that the times they are a-changing at EduCorp. I haven't been happy for awhile, but now at 52, I think I'm being marginalized by the new crowd in charge. I'm not nearly as upset as I would be if I still had CC debt, a car payment and a mortgage. I have none of those things now, so I can at least see the light at the end of the tunnel.
So for planning purposes...
It's still a good three years at a minimum until I can "separate from service" and access my 403b. And I don't know if I will have enough but I'm thinking semi-retirement might be a possibility. So, how, exactly does this access happen?
Do I tell the company (TIAA-CREF) how much I want every month? Even if it was something stupidly outrageous, like say $50,000, would they have to send it to me?
Do they tell me how much they will let me have (like a parent to a child, even though it's my money)? And is there any way to know this amount now - 3 or 4 years out?
Can I take the whole thing, and roll it over into something else, either inside or outside the company? How would this help? What would be the pitfalls?
IOW, what are the nuts and bolts and options of actually starting to get a monthly check from my nest egg? What might my options be?
The company reps are not paid on commission, so they don't try and sell me any particular fund. And I feel I get good advice WRT diversification. However, I do think they have an interest in me paying into the pot for as long as possible, so I'd rather have some independent answers here.
Thanks in advance!
-hguyw
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11-12-2009, 07:07 PM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2007
Posts: 14,328
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11-12-2009, 07:15 PM
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#3
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2005
Posts: 10,252
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As you noted, TIAA-CREF has great counselors that you can call up and they can tell you how to get the loot. It will all depend on what investments you are using at TIAA-CREF. Some investments you can withdraw at age 59.5 without problems. Some investments you have to withdraw over a 9- or 10-year payout period. It seems you think you can get some investments at age 55. Some you can rollover into your own IRA when you stop working for your employer.
If you get all the money into your own IRA, then you control the nuts-and-bolts. You could withdraw from an IRA any which way: $1 a day, $10 a week, $52.37 a month, $100,000 year, whatever.
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11-12-2009, 07:29 PM
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#4
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Recycles dryer sheets
Join Date: Feb 2008
Posts: 106
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Quote:
Originally Posted by LOL!
It seems you think you can get some investments at age 55.
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From the SUNY Tax Deferred Retirement Savings Program brochure:
"Withdrawals will be subject to federal income tax. If you are under age 59 1/2, you may be subject to an additional 10% tax. This additional tax does not apply if you separated from service at age 55 or older, if you are receiving a lifetime income, or in cases of death, disability, or significant un-reimbursed medical expenses."
Am I mis-interpreting this in some way?
-hguyw
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11-12-2009, 07:40 PM
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#5
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Thinks s/he gets paid by the post
Join Date: Jan 2006
Posts: 1,012
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Quote:
Originally Posted by hguyw
From the SUNY Tax Deferred Retirement Savings Program brochure:
"Withdrawals will be subject to federal income tax. If you are under age 59 1/2, you may be subject to an additional 10% tax. This additional tax does not apply if you separated from service at age 55 or older, if you are receiving a lifetime income, or in cases of death, disability, or significant un-reimbursed medical expenses."
Am I mis-interpreting this in some way?
-hguyw
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if it is like a 401k (which i think it is but you need to check) if you separate from your employer at age 55 or older you can start withdrawing (any amount you want) without penalty (you still have to pay income taxes). in other words your bolded statement is true.
however if you roll it into an IRA then you will pay the penalty if you start WDing before 59.5 (unless you do a 72t)
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11-17-2009, 12:14 PM
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#6
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Thinks s/he gets paid by the post
Join Date: Feb 2007
Posts: 1,250
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Has anyone here actually accessed their pre-tax retirement savings after rolling over to a 72t?
__________________
Make no mistake, my friend, it takes more than money to make men rich. - A. P. Gouthey
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11-17-2009, 12:54 PM
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#7
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2006
Posts: 12,483
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Quote:
Originally Posted by Fireup2025
Has anyone here actually accessed their pre-tax retirement savings after rolling over to a 72t?
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I think Cycling Investor does that, a few others.maybe audrey1?
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)
This Thread is USELESS without pics.........:)
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11-17-2009, 12:57 PM
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#8
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Thinks s/he gets paid by the post
Join Date: Jul 2005
Location: Los Angeles area
Posts: 1,708
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Quote:
Originally Posted by Fireup2025
Has anyone here actually accessed their pre-tax retirement savings after rolling over to a 72t?
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I retired at 48 in 2006, rolled over my 401k into an IRA, and started taking 72t distributions. I use the simplest to calculate method, which means I withdraw about 3% (slowly rising) of my Dec 31 balance out each year.
__________________
learn, work, save, invest, fire
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11-17-2009, 01:18 PM
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#9
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 1,183
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Quote:
Originally Posted by Fireup2025
Has anyone here actually accessed their pre-tax retirement savings after rolling over to a 72t?
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I currently am on year 3 of a 72T distribution. PM me if I can help.
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11-17-2009, 02:05 PM
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#10
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Recycles dryer sheets
Join Date: Feb 2008
Posts: 106
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I'm glad this thread was revived...I went looking for it and couldn't find it. (Overlooked it I guess.)
When you do the rollover, do you have to rollover the entire 403b or 401K? Or can you do just enough to cover the withdrawals you want to do with the 72t?
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11-17-2009, 02:07 PM
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#11
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Thinks s/he gets paid by the post
Join Date: Oct 2003
Posts: 1,319
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The latter. Roll over enough to cover the withdrawals you want.
__________________
We are, as I have said, one equation short. – Keynes
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11-17-2009, 02:38 PM
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#12
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Full time employment: Posting here.
Join Date: Apr 2009
Posts: 939
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I was VERY unhappy with my employer's 403b choices in mutual funds. I have moved almost all of it into a self-directed IRA. I'm 61. I think it is possible to do this after you turn 59 1/2. I haven't accessed the money since I'm not yet retired.
The money I moved was money I had contributed, not matching money.
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11-17-2009, 04:36 PM
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#13
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2005
Posts: 10,252
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@thinker25: if you are still employed, what you have done is an in-service rollover. Some plans allow this; many do not. An in-service withdrawal may also be possible after age 59.5, but these are not the same as a 72(t).
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11-17-2009, 06:22 PM
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#14
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Thinks s/he gets paid by the post
Join Date: Feb 2006
Posts: 1,183
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Most employers make you take it all at once for rollover to an IRA (unless you set up periodic dist with them). You then set up multiple IRA's meaning 2 or more in whatever ratio you decide. You want to do a 72T for income? Then simply specify which IRA it is against. The other IRA continues along till you decide you need to take out money as another 72T or a one time lump sum with a penalty or you reach the magical age of 59 and 1/2 after which there is no penalty on withdrawn funds. The 72T plan ends after a minimum of 5 years of distributions AND reaching age 59 and 1/2.
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11-17-2009, 09:18 PM
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#15
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Full time employment: Posting here.
Join Date: Apr 2009
Posts: 939
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Quote:
Originally Posted by LOL!
@thinker25: if you are still employed, what you have done is an in-service rollover. Some plans allow this; many do not. An in-service withdrawal may also be possible after age 59.5, but these are not the same as a 72(t).
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Thanks, I didn't know what it was called but I am definitely able to do it. I can access my self-directed IRA, of course (because of age >59.5) - I don't because I am still employed.
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