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Old 05-25-2023, 11:39 AM   #41
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After FIRE, I did what I could to reduce tIRA and 401(k) money while I had some flexibility (no "income" and low taxes.) So I eventually converted all tIRAs to Roths, created some tIRAs from my 401(k) and converted them to Roth. Now, I have Roth IRAs and just one 401(k) to deal with (aka RMDs.) I find it easier to manage this way and I've smoothed out my tax situation quite a bit as I now take RMDs (and quite a bit more) from the 401(k). My taxes and IRMAA etc. situation is more or less well in hand. I consider each vehicle type (401(k), tIRA, Roth, taxable, etc.) as a piece of the personal financial puzzle. Moving them correctly limits taxes and especially "gotchas" like IRMAA and perhaps for some ACA, etc. Not saying I'm good at this "game" but I'm competent, I think.

Simply saying "I'm not touching so-and-so" should be for an overall portfolio/plan reason not just a statement to be proud of. Everyone is different so YMMV.
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Old 05-25-2023, 12:46 PM   #42
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With the benefit of a good pension, the main thing I have touched my 401K since retirement for has been for paying taxes, in lieu of making estimating tax payments (something I learned on this site). I did make a couple of relatively small withdrawals just to "celebrate" my retirement and spent them on something foolish . Even with that, after almost 5 years my 401K is still significantly (IMHO) larger than when I retired. That will likely still be the case in 8 years.

I have tIRAs for myself and DW that I have performing Roth conversions before attempting that with my 401K. DW's IRA conversion was completed this year. It will take me about 5 years to complete my IRA conversion, so the bulk of my 401K will be in place at RMD age. RMDs + pension + max SS payment = a lot of taxes and increased Medicare premium costs. But that is fine by me. Odds are that the 401K will be our LTC insurance and/or the bulk of what we pass on to our heirs.
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Old 05-25-2023, 01:46 PM   #43
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If you need or even spend your 401k right away, might be a bad sign unless you have all the SI you’ll ever need.
Or probably not. A lot of people will be almost entirely relying on SS and their 401K, and are just fine withdrawing from the latter immediately.

What is SI?
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Old 05-25-2023, 01:53 PM   #44
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With the benefit of a good pension, the main thing I have touched my 401K since retirement for has been for paying taxes, in lieu of making estimating tax payments (something I learned on this site). I did make a couple of relatively small withdrawals just to "celebrate" my retirement and spent them on something foolish . Even with that, after almost 5 years my 401K is still significantly (IMHO) larger than when I retired. That will likely still be the case in 8 years.

I have tIRAs for myself and DW that I have performing Roth conversions before attempting that with my 401K. DW's IRA conversion was completed this year. It will take me about 5 years to complete my IRA conversion, so the bulk of my 401K will be in place at RMD age. RMDs + pension + max SS payment = a lot of taxes and increased Medicare premium costs. But that is fine by me. Odds are that the 401K will be our LTC insurance and/or the bulk of what we pass on to our heirs.
Heh, heh, join the club! You may still have time to finagle your assets (pay more taxes now) and drop your later withdrawal rates below IRMAA levels.

Isn't it fun - having enough money that it's a pain to deal with?
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Old 05-25-2023, 01:58 PM   #45
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Why is it a big deal not to touch the 401k accounts? If you have other money to spend, you don't need to touch your 401k accounts. Some people may not touch their taxable accounts if desired.
To me it would mean I saved a lot more than I needed to and worked a lot longer than I needed to. I would not be ok with that. I won't have the money any of you have but I also won't have spent 30+ years working 40+ hours a week.
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Old 05-25-2023, 02:27 PM   #46
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As soon as I could, I rolled the pre-tax portion of my 401k to a TIRA. That was 21 years ago. Never spent any of it. Did and doing Roth conversions last 10 years or so.
Never felt that I/we over-saved. Never know what tomorrow might bring. The monthly nursing home dollar amounts some of y'all are quoting on another thread seems to say plan for a large chunk to fund one of those. Most likely for my DW. Very unlikely for me.

When I got rid of the 401k, the post-tax portion, which was much smaller, I transferred into some bond funds, and many years later I switched the gains there to bank, rather than re-invest. So maybe one could say that I DID "spend some of my 401k", though I've never viewed it as that. The only reason for the post-tax contribution to 401k was to keep the payroll deduction constant, when I hit the "highly compensated individual" limit for pre-tax 401k.
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Old 05-25-2023, 02:43 PM   #47
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We haven’t touched our 401k’s, TIRAs or my Roth IRA. Won’t until RMDs start. But then that shouldn’t be unusual - more likely later in retirement when 10-30 years of COL really have an impact. If you need or even spend your 401k right away, might be a bad sign unless you have all the SI you’ll ever need.
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Or probably not. A lot of people will be almost entirely relying on SS and their 401K, and are just fine withdrawing from the latter immediately.

What is SI?
SI is Secure Income like Soc Sec, Pensions, Annuities et al. A significant number of people here don't need their nest eggs (401k, IRAs, portfolio) if all past history repeats - we've done several polls over the years.
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Old 05-25-2023, 02:58 PM   #48
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Several retired friends and colleagues that I know haven't touch their 401K for years after retirement. I just wonder if it's unusual and if anyone here is doing it.

I think some of us are over saved and end up not living or enjoying as much in their younger days. How much is enough? 2 millions?? 3 millions? Why?? so you died left over a big chunk of your wealth for your kids and son/daughter-in-laws?

Your thought?

enuff
Thoughts? What are your plans OP?
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Old 05-25-2023, 02:58 PM   #49
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It is interesting that a number of people fully convert their IRA to Roth, but keep their 401ks. They have lost a flexibility of qualified charitable distributions (QCDs) that is available for IRA, but not 401k or other qualified employer plans. We have rolled over our 401k to our IRAs. We have been doing Roth conversions for the past 5 years and plan to continue until at least 70 when claim SS. Being able to take QCD will help us stay under IRMAA threshold once RMDs begin at 73.
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Old 05-25-2023, 03:00 PM   #50
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To me it would mean I saved a lot more than I needed to and worked a lot longer than I needed to. I would not be ok with that. I won't have the money any of you have but I also won't have spent 30+ years working 40+ hours a week.

It just depends on one's situation. I enjoyed my work, so never looked at it as 'working longer than I need to". As for having "saved a lot more than I needed to", I just look at that as benefitting those people/organizations I choose to leave an inheritance to. So I am fine with "too much" , but I understand how others can have a different perception.
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Old 05-25-2023, 03:02 PM   #51
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The monthly nursing home dollar amounts some of y'all are quoting on another thread seems to say plan for a large chunk to fund one of those. Most likely for my DW. Very unlikely for me.
I can see paying for part time or even full time care in my home for the DW or I or both, but no way that I am going into a nursing warehouse home. Maybe that's what I'm saving my 401k for !
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Old 05-25-2023, 03:07 PM   #52
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It is interesting that a number of people fully convert their IRA to Roth, but keep their 401ks. They have lost a flexibility of qualified charitable distributions (QCDs) that is available for IRA, but not 401k or other qualified employer plans. We have rolled over our 401k to our IRAs. We have been doing Roth conversions for the past 5 years and plan to continue until at least 70 when claim SS. Being able to take QCD will help us stay under IRMAA threshold once RMDs begin at 73.
Where have you seen people that have done this?

One reason people might is if they have good funds in the 401K, like a stable value fund, which was especially attractive when fixed income rates were very low. Another is that in many states, a 401K is protected against lawsuit or bankruptcy.

And there's no reason someone couldn't roll the 401K over to a tIRA later if they want to do QCDs.
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Old 05-25-2023, 03:22 PM   #53
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Thoughts? What are your plans OP?
Excellent question. I think we over saved but DW still want to be frugal. We drives Honda, lived in a modest home, iphone 11, NOTHING luxurious while I think we can afford more. No cable, basic internet, nice but "budget" dinner (nothing like $200-$300 meals). Basically we are a few dollars ahead of our friends but we live way below their standard. Some said that probably leave too much for the kids and their spouses. (hope they don't get divorce).

At the end of the day, we probably won't touch our 401k.

Enuff
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Old 05-25-2023, 04:02 PM   #54
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Excellent question. I think we over saved but DW still want to be frugal. We drives Honda, lived in a modest home, iphone 11, NOTHING luxurious while I think we can afford more. No cable, basic internet, nice but "budget" dinner (nothing like $200-$300 meals). Basically we are a few dollars ahead of our friends but we live way below their standard. Some said that probably leave too much for the kids and their spouses. (hope they don't get divorce).

At the end of the day, we probably won't touch our 401k.

Enuff
I drive a Honda, and live in a modest house. We rarely go out to eat, although DH buys good quality food. We have cable (DH wanted it). We worked hard, and paid for school for the kids. We live better than some, others live a more luxurious life than we do. I can't say I spend much time on regrets, and I don't tend to be envious of those who have more in the way of material items, or money, than I do.

DH had two 401ks, and rolled one into an IRA. Initially, he did not want to put a penny into that second account (as he was not a saver) but I told him it could be his "fun money" account, which motivated him to start contributing to it. It grew more than he had imagined that it would. The plan for the 401k which he rolled into the IRA is to pay for extras until his SS kicks in, and he has been withdrawing a limited amount each year to pay for some extras. He doesn't want to touch the second 401k ever - but we shall see.

I rolled my 401k into an IRA, as the 401k had high fees, and am currently doing Roth conversions. The priority will be taking care of DH and myself and ultimately we don't know the total cost.

If some is left for the kiddos, so be it.
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Old 05-25-2023, 04:06 PM   #55
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Originally Posted by Enuff2Eat View Post
Several retired friends and colleagues that I know haven't touch their 401K for years after retirement. I just wonder if it's unusual and if anyone here is doing it.

I think some of us are over saved and end up not living or enjoying as much in their younger days. How much is enough? 2 millions?? 3 millions? Why?? so you died left over a big chunk of your wealth for your kids and son/daughter-in-laws?

Your thought?

enuff
I think if you look at spending vs wealth a lot of us have over-saved. IMO it is important to enjoy your younger years but that doesn't necessarily cost a lot. It's easier to stick with working if you mostly enjoy it. I would have liked the opportunity to work part time but it wasn't feasible. I didn't suffer much from flying coach but I should have devoted less time to trying to get the best deal on small expenditures. Driving across the city to compare the prices and quality of goods took time that often could have been more productive.
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Old 05-25-2023, 04:30 PM   #56
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To me it would mean I saved a lot more than I needed to and worked a lot longer than I needed to. I would not be ok with that. I won't have the money any of you have but I also won't have spent 30+ years working 40+ hours a week.
Trouble is there is no way to know that for sure until 30 odd years after you’ve retired if you haven’t had to cut back (severely) or worse - I assume you “would not be OK with that” either. Ultimately what “savings” any of us consider “safe” varies dramatically when being asked decades from our expiration date…
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Old 05-25-2023, 04:34 PM   #57
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It just depends on one's situation. I enjoyed my work, so never looked at it as 'working longer than I need to". As for having "saved a lot more than I needed to", I just look at that as benefitting those people/organizations I choose to leave an inheritance to. So I am fine with "too much" , but I understand how others can have a different perception.
That's fair. I just have a hard time with the idea of enjoying going to work. I have never had a job that I liked enough to rather be there than not be there. YMMV.
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Old 05-25-2023, 04:48 PM   #58
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Will most likely take money out.
We have no kids to leave the money to, so I plan to have $0 balance by 105-110 years old
And we'll be traveling to Europe and other exotic countries every year. It will be 3 years before I qualify for Social Security and have no pension, so IRA then some 401k it is.
Once we take Social Security, the scenario maybe different, so we'll see at that point.
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Old 05-25-2023, 09:02 PM   #59
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Upon ER two years ago, I was ecstatic after learning about the MFJ LTCG's 0% tax bracket. So I planned to live (Federally) tax-free for the first five or so years. Until I calculated what RMDs might be, and what taxes might be once I start taking SS. I would be bumped a few tax brackets, and that changed my whole withdrawal strategy. Now, in addition to maxing out the 0% LTCGs tax bracket, I'm also taking penalty-free distributions from my 401(k) [Rule of 55] and larger distributions from an inherited IRA. Terrible problem to have, but you really need to look down the road...
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Old 05-25-2023, 09:29 PM   #60
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Upon ER two years ago, I was ecstatic after learning about the MFJ LTCG's 0% tax bracket. So I planned to live (Federally) tax-free for the first five or so years. Until I calculated what RMDs might be, and what taxes might be once I start taking SS. I would be bumped a few tax brackets, and that changed my whole withdrawal strategy. Now, in addition to maxing out the 0% LTCGs tax bracket, I'm also taking penalty-free distributions from my 401(k) [Rule of 55] and larger distributions from an inherited IRA. Terrible problem to have, but you really need to look down the road...
You have factored in that the IRA distributions reduce the 0% LTCG space, right?
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