SoReadyToRetire
Recycles dryer sheets
Hello, intelligent people--
I'm about to pull the trigger on buying a Guaranteed Lifetime Annuity II from New York Life, at my Fidelity planner's suggestion. Would love to run it by you guys for your input first.
I'm newly divorced and as I wrote in a previous post, the ex got a BIG chunk of my money, so I'm now trying to plan for my single future. Recently I decided it would be a relief to have more guaranteed income.
I get ~$2250 net from SS each month after Medicare and taxes.
My assets are a fully paid home, a Fido Roth IRA curently worth $74K and a Fido Rollover IRA currently worth $890K.
I've been investing in new issue CDs in the Rollover IRA while rates were over 5%. About 50% of my portfolio is in NVDA stock, some in Fidelity Puritan Fund (blended) and the rest is in cash.
Current plan is to take the $355K currently sitting in cash and buy a Guaranteed Income Annuity II, with cash refund option, from NY Life. That would give me another $2K/month income starting 12/1/24. And with the refund option, of course, if I die before I've been paid back the initial $355K, whatever remains would come back into my estate.
This would give me a total guaranteed income of about $4234/month for life (I'm 66; my life expectancy is 89). My monthly expenses are $4,200, which includes $2K "play money".
This plan would leave me with about $610K in the IRA's that can continue to grow, plus all my expenses would be covered. It would allow me to be less nervous about the day-to-day performance of my portfolio, and I'd still have that $610K cushion.
I know pulling $355K out of my IRA, in addition to the $110K I already had to pull out for the divorce, will be a BIG tax hit. But at least it'll all be in one year. I have cash in my checking account to pay the tax bill, and I can appeal the IRMAA that will most likely happen.
Does this seem reasonable to those of you with experience with these things? Are there any major drawbacks that I'm not considering?
Would love to hear opinions on this, as I'm supposed to be deciding by Monday whether to do it. Thank you!
I'm about to pull the trigger on buying a Guaranteed Lifetime Annuity II from New York Life, at my Fidelity planner's suggestion. Would love to run it by you guys for your input first.
I'm newly divorced and as I wrote in a previous post, the ex got a BIG chunk of my money, so I'm now trying to plan for my single future. Recently I decided it would be a relief to have more guaranteed income.
I get ~$2250 net from SS each month after Medicare and taxes.
My assets are a fully paid home, a Fido Roth IRA curently worth $74K and a Fido Rollover IRA currently worth $890K.
I've been investing in new issue CDs in the Rollover IRA while rates were over 5%. About 50% of my portfolio is in NVDA stock, some in Fidelity Puritan Fund (blended) and the rest is in cash.
Current plan is to take the $355K currently sitting in cash and buy a Guaranteed Income Annuity II, with cash refund option, from NY Life. That would give me another $2K/month income starting 12/1/24. And with the refund option, of course, if I die before I've been paid back the initial $355K, whatever remains would come back into my estate.
This would give me a total guaranteed income of about $4234/month for life (I'm 66; my life expectancy is 89). My monthly expenses are $4,200, which includes $2K "play money".
This plan would leave me with about $610K in the IRA's that can continue to grow, plus all my expenses would be covered. It would allow me to be less nervous about the day-to-day performance of my portfolio, and I'd still have that $610K cushion.
I know pulling $355K out of my IRA, in addition to the $110K I already had to pull out for the divorce, will be a BIG tax hit. But at least it'll all be in one year. I have cash in my checking account to pay the tax bill, and I can appeal the IRMAA that will most likely happen.
Does this seem reasonable to those of you with experience with these things? Are there any major drawbacks that I'm not considering?
Would love to hear opinions on this, as I'm supposed to be deciding by Monday whether to do it. Thank you!