Timing is Everything

L1: Timing is EverythingI started my 72t in Feb 06 using the amortization method at the age of 55. Things were going along just fine until this year. Like most people I’m getting a big hit on my IRA balance and contacted my custodian about using my one time switch to RMD method. Using the calculator on this website and my IRA balance on 9/30 the RMD amount seemed do-able since I inherited some money this year and thought I would use it to minimize burning through my IRA too early. My custodian said I had to write them a letter requesting the RMD switch.Now things have gotten worse.MyIRA balance won’t provide the necessarycash I need using RMD method.I contacted my custodian and placed a hold on my request to switch to RMDafter the first of the year. My question to the forum is, given the volatility of the market would it be better using the RMD switch away and figure a way to get by then do a recalculation with amorization? My logic is if I don’t take the RMD switch at the end of this year and wedo have a deep recession I have another year to wait.I understand things aren’t normal right now. I just don’t want to make the switch and regret it later.Thank you 2008-10-23 05:30, By: hsfmini, IP: [67.142.130.16]
L2: Timing is EverythingIt is probably too late this year to make the changeto the Minimum Distribution method. Check the amount you have taken vs the amount that would have been taken under the MD method – if the excess exceeds the amount that can be rolled back into the IRA, you have waited too long – Timing is Everything, maybe next year.If you decide to add recalculation to your existing plan, you will be changing the basic assumptions and will in effect “bust” the plan – Timing is Everything, you should have added recalculation when the plan was started.I’m sure that there are a variety of people that are in the same situation – assets substantially diminishing. There is a positive, if the plan runs out of money the plan won’t be “busted” based on R.R. 2002-62.Timing is Everything – too many people wait until there is a problem before asking for help. You probably need to sit down with someone who is familiar with SEPP plans and can also give you some investment advice regarding the type of assets that are best used to fund a SEPP. 2008-10-23 05:51, By: gfw, IP: [98.214.144.242]