I am about to retire, I have a 401(k), an IRA, an annuity and a small pension. What is the best way to start taking distributions?
Hi - No question your first step should be to build a retirement income roadmap. As a complimentary service we can help you build it so you can evaluate your options. It will answer all questions related to retirement income including how to ensure your don't outlive your own money - one of, if not, THE most important issue once you stop working. I have been an advisor for 25 years and am a big proponent of keeping your investments liquid and protected - both critical IMO especially when you're retired. From my profile page here you can message my office or connect through my website to set a time to discuss further. | 06.16.16 @ 19:56
There is no way to answer that question from the limited information given. The answer depends on several things, like: how much income do you need each month right now? how will that change over the next 10, 20, or 30 years? what are your funding plans for advanced medical costs? were your 401(k) contributions pre-tax or after-tax? is your IRA a traditional or Roth? what type of annuity do you have? what are the terms of your pension? what is the likelihood that your pension is actually funded? are you married? what are your estate planning desires? are you eligible for Social Security?
As you can see, there is no shortcut or easy answer to your question. Your retirement "party" may last 20 or 30 years. Don't try to plan for that party on the back of an envelope. This is the biggest party you will ever throw. It will affect the most other people. It will be the most expensive. It will be the most complicated. This is not a party you should try to plan quickly or totally by yourself. Seek the counsel of a professional financial planner. Make sure they are in a position to provide you with unbiased planning advice, not just sell you products or investment management services. | 06.28.16 @ 19:46
The best way is a question that can only be answered based on your unique situation. As an advisor I would look at tax advantages, your comfort with various levels of risk, longevity (and of your spouse if there is one). All of the previous questions should be asked of you. I as your planner would then put in writing an outline showing the distribution order. Very important is to include Social Security in your income planning. Doing so may increase your lifetime income by $50,000, $100,000 or more. Including Social Security is also necessary to actually answer your questions. A general plan (many variables of your will change this) might be 401(k), IRA, Social Security, annuity. The income selection for your pension would be dependent on the others. As always, I'm glad to discuss your personal situation with no charge or obligations | 06.28.16 @ 20:29
It would be nice to know the balances in each type of investment, the things each are invested in as well as most are basically shoe boxes that hold investments. What you might want to do is look at what you need to get by in retirement and first off how much of that will be covered by income generated through these things. Do these accounts provide more than enough, enough or not enough retirement income for you?
Clearly if it only enough or not enough you must use them all for retirement as deferral doesn't work for you. If your retirement choices provide you more than enough money, then you look at where the money sits and what it earns for you. There actually isn't a stock answer that you do no matter what, it simply depends on how much money you need for retirement needs.
| 06.29.16 @ 00:27