# Why not round?

L1: Why not round?In the planning pointers, it states:

“Don’t Round. When you calculate the annual SEPP amount, don’t round the result – use the exact amount to the penny. ”

What is the basis for this advise? I thought the SEPP calculations were the maximum withdrawal amounts, and that a lesser amount could be used.

I am 53 and planning to start a SEPP plan w/i the next few days.2014-09-07 23:19, By: Don, IP: [174.19.234.72]

L2: Why not round?No, the exact amount must be withdrawn or a pro rated amount by the month for your first calendar year.As far as rounding to amounts smaller than whole dollars, gfw can best address that.

The only times your plan is allowed to reduce the original calculation is when you have adopted a recalculation plan (not recommended) or if you make the one time switch to the RMD method of calculation.2014-09-08 02:56, By: Alan S, IP: [67.61.217.44]

L2: Why not round?SEPP calculations are not the maximum amount that you can take, they are the exact amount that you must take.

You can change the initial interest assumption to be lower than the maximum, but then based on your attained age, the interest rate used and the initial balance your calculations will produce an annual withdrawal amount. That amount is the exact amount that must be taken on an annual basis.

The no rounding comment was made because most people divide the annual amount by 12 to come up with a monthly withdrawal. The annual amount divided by 12 (and then rounded and multiplied by 12) will result in a total annual withdrawal within about $1 of the original calculated amount. Something less than a $1 variance because of is still considered Ok. More than $1 is not Ok.2014-09-08 09:17, By: Gfw, IP: [205.178.51.82]

L3: Why not round?Thanks for the response2014-09-08 18:14, By: Don, IP: [174.19.234.72]

L2: Why not round?Make sure you get advise from your accountant before you take a penny from savings. You do not want to make any mistakes in this process.

good luck,

Bend Bound2014-09-09 21:01, By: Bend bound, IP: [67.191.47.33]