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72t– is it this easy?

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Last Updated On
ByJeff

L1: 72t– is it this easy?After some study, It looks to me that I can work up my own SEPP plan as long as I keep it simple.
I have consolidated some IRA funds into one IRA at Vanguard to be my SEPP asset universe. I set this up understanding that there will be no additions or non-SEPP distributions until after the last SEPP distribution.
Aside from the SEPP, My wife and I will still have IRAs, non-deferred savings and pensions for retirement.I am semi-retired and we are using this SEPP to help smooth out the cash flow until mortgage is paid off and other retirement assets become usable.
I turned 52 in Dec. 2006. My statement of 12/31/2006 shows a balance of $224,615.31 in the IRA. I plan to “manually” request 8 annual distributions with the first distribution on Jan. 16, 2007 and the last one on Jan 16, 2014. I plan on taking $15,526.52 per year (no recalculations) based on 5.7% interest with 31.4 single life expectancy and the 12/31/06 balance:
$224,615.31 X .057 / ( 1 – 1.057^-31.4) = $15,526.52
I will inform Vanguard of my plans in writing by using the SEPP worksheet that they provide along with the planning template at this site and the Vanguard distribution request form. By phone they have informed me that the 1099R distribution code is always listed as a “1” so I will be prepared to file IRS form 5329. I will preserve documentation in a specific file that includes setup, calculations, distribution dates and statements. I will not alter my SEPP until July 2014 and I will notify Vanguard then of the end of the SEPP payments.
Am I missing anything vital?I manage all my investments, file my own taxes and am used to some simple financial calulations (in the past I”ve written software programs to create my own amortization tables while shopping and comparing mortgages). I”ve done some homework and this sounds doable for my situation without a financial advisor.

2007-01-02 21:17, By: Jeff, IP: [64.81.229.187]

L2: 72t– is it this easy?Hello Jeff:
I think you have covered all the bases.
TheBadger
wjstecker@wispertel.net

2007-01-03 04:27, By: TheBadger, IP: [72.42.67.112]

L2: 72t– is it this easy?Bill,
I concur with your response to Jeff. Gee … I wish all of our responses could be this simple.
Jim2007-01-03 06:54, By: Jim, IP: [70.184.2.72]

L2: 72t– is it this easy?Thank you gentlemen. I”ve taken some time to go over the content
in this board. I think you have been very generous with your time
and information.

I”m not sure I need it but I decided to get Mr. Stecker”s book. I
believe it would help me if there are any significant life changes that
require me to reassess this SEPP I”m setting up.

regards,

Jeff
2007-01-06 14:03, By: Jeff, IP: [64.81.229.187]

L2: 72t– is it this easy?Jeff,
In your formula…….. $224,615.31 X .057 / ( 1 – 1.057^– 31.4) = $14,526.52 …..whatdoes the symbol
“^–” represent?2007-03-02 09:50, By: DJ Rider, IP: [63.105.51.10]

L2: 72t– is it this easy?The symbol “^” is usually used to indicateexponentiation. The character is called “up arrow” or caret. I don”t know what the “–” were being used for in the formula.2007-03-02 10:02, By: John, IP: [71.208.231.158]

L2: 72t– is it this easy?I went back and looked at the original post. The formula is “^-” and not “^–“. The original formula is correct as shown. The number 1.057 is raised to the negative power of 31.4.2007-03-02 10:08, By: John, IP: [71.208.231.158]

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