JackJester
Recycles dryer sheets
DW and I plan to RE in 4 years on Jan 1 (of the year I turn 55). So now we need to get from 55 to 59.5.
We will need an estimated $75K to live on per year (I calculate we can stay right below the 15% tax line and be comfortable).
We will have $1.2mil in 401K and $75K in an after tax brokerage account. I’d like to move that 401K to an IRA with the brokerage to have better investment choices. ..but…
I need $ to cover 5.5 years before tapping 401K penalty free, so that’s approx $412500.
I assume (correct me if I am wrong) it is best to tap the $75K after tax to live on during those 5.5 years, so that leaves $337500 to cover somehow.
My choices are Age 55 Rule or SEPP72t or maybe a combination. I can’t do Roth conversions since I won’t be able to touch that $ for 5 years anyway. I don’t want to do 72t unless I have to due to the complexity and possibly screwing it up and paying a big penalty.
With all that said, is my best choice to leave $337500 in my company 401K when I retire and then rollover the rest of the 401K to the IRA? And then just use the 55 Rule to withdrawal from the company 401K each year until I get to 59.5?
Thank You
We will need an estimated $75K to live on per year (I calculate we can stay right below the 15% tax line and be comfortable).
We will have $1.2mil in 401K and $75K in an after tax brokerage account. I’d like to move that 401K to an IRA with the brokerage to have better investment choices. ..but…
I need $ to cover 5.5 years before tapping 401K penalty free, so that’s approx $412500.
I assume (correct me if I am wrong) it is best to tap the $75K after tax to live on during those 5.5 years, so that leaves $337500 to cover somehow.
My choices are Age 55 Rule or SEPP72t or maybe a combination. I can’t do Roth conversions since I won’t be able to touch that $ for 5 years anyway. I don’t want to do 72t unless I have to due to the complexity and possibly screwing it up and paying a big penalty.
With all that said, is my best choice to leave $337500 in my company 401K when I retire and then rollover the rest of the 401K to the IRA? And then just use the 55 Rule to withdrawal from the company 401K each year until I get to 59.5?
Thank You