David1961
Thinks s/he gets paid by the post
- Joined
- Jul 26, 2007
- Messages
- 1,085
I have a question concerning the allocation between regular, taxable investments and “retirement investments” such as 401(k)s, IRAs, etc.
Here is my specific situation. I am 46 and have about $2M in investments. About $700k of that is in my 401(k) plan at work and my IRAs. The rest ($1.3M) is in taxable investments. Suppose I want to RE at 50. Since I cannot withdraw from any of the “retirement” investments before age 59 ½ without paying a penalty, I will need to live off the other investments until age 59 ½. This got me to wondering if it is actually possible to have too much of your investment portfolio in retirement accounts that you cannot easily access before age 59 ½. For the folks who will work until they are at least 60, it makes sense to put as much in your retirement accounts, but are there any guidelines for folks who want to RE? Am I missing something here?
Here is my specific situation. I am 46 and have about $2M in investments. About $700k of that is in my 401(k) plan at work and my IRAs. The rest ($1.3M) is in taxable investments. Suppose I want to RE at 50. Since I cannot withdraw from any of the “retirement” investments before age 59 ½ without paying a penalty, I will need to live off the other investments until age 59 ½. This got me to wondering if it is actually possible to have too much of your investment portfolio in retirement accounts that you cannot easily access before age 59 ½. For the folks who will work until they are at least 60, it makes sense to put as much in your retirement accounts, but are there any guidelines for folks who want to RE? Am I missing something here?