72t ira

L1: 72t iraCan the broker company help with a 72t? Does 50000 on 635000 at age 51 1/2 reasonable? Takeing equal amounts of the yearly 50000 monthly. 2002-04-11 03:27, By: bonusmon, IP: [127.0.0.1]
L2: RE: 72t iraFirst, for purposes of 72(t) there is no 51 1/12 – you are either are 51 or age 52 – if you are going to start this year, what is your attained age on your birthday this year?After determining your age, mere go to our calculator (72t Calculator) and put in your age and the amount – it will calculate the payments for you.A broker can help, but if I were you, I would read eanough to make sure that I was asking the broker the right questions!2002-04-11 04:28, By: Gfw, IP: [127.0.0.1]

L2: RE: 72t iraCan the broker company help with a 72t? Does 50000 on 635000 at age 51 1/2 reasonable? Takeing equal amounts of the yearly 50000 monthly.Generally, brokers are of no help with respect to SEPPs. Assuming you will be 52 sometime this year; then yes, $50k per year from an account with $635K in it would be tax acceptable/permissable.However, I would like to broaden the question; should some one with $635k take $50k per year and theoretically retire? For people in their late 40’s & early 50’s, one can use the annuity method and easily compute a SEPP annual payment equal to 8% to 10% of the total account balance and have that withdrawal qualify under 72(t)(2)(A)(iv) thus escaping the 10% early withdrawal penalty.However, should you do it? If you have two IRAs each with $635k in them & want to start SEPPs at $50k per year on one of them; that’s fine (forgeting the tax issues here for a moment) because your aggregate withdrawal is really 4% or so; a very survivable withdrawal rate; not just to age 59 1/2 but to age 85 or so (that’s when you go prone & visit the next life).What if your only real investment asset is the $635k IRA. Should you start $50k withdrawals at age 52? This creates a withdrawal rate of almost 8%; therefore I would say probably not. Historical studies have shown (depending on who you want to read) that the lifetime survivability of withdrawal rates above the 4.5% to 5% level drop precipitiously. In short, in our later case here, starting 8% withdrawals at age 52 has about a 1/3rd chance of surviving; e.g. the money out-survives your life.As a result, I would like to caution everyone who is considering SEPPs to look both at the tax implications as well as the long term (20 – 40 years) survivability of their decisions.TheBadgerIf you want to learn more drop me a note at wjstecker@wispertel.net or visit www.retireearlyhomepage.com2002-04-11 10:43, By: TheBadger, IP: [127.0.0.1]