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Understanding the best way to tap your IRAs and other accounts can help you preserve your savings and lower your tax bill....
A couple learning about the different types of withdrawal strategies to consider for retirement. Planning for retirement involves not only accumulating savings but also strategically withdrawing funds...
A prominent lawyer was recently sentenced to home confinement for falsely claiming hardship to withdraw funds. How desperate must you be to take money out?...
One of my ongoing challenges as a writer is explaining financial concepts in an easy-to-understand manner. With a background in business school and 13 years in banking, financial concepts come natural...
Americans are taking early withdrawals from their 401(k)s at record rates “across different ages and income levels.”¹ According to Capitalize, “Half of Americans have made early...
Avoid penalties and minimize taxes when you pull money out of your 401(k) or IRA....
I've read that it's recommended to pull out 4-6% annually from one's IRA to subsidize retirement income. Assuming 6% withdrawal per year at my current value, that nets me an additional $1000 per month...
There is a common rule-of thumb that 4% can be withdrawn from a IRA or 401K account each year in retirement, and the balance of the account should not go down. What would be the reasons for a retired ...
The 4% rule helps us understand how much we can safely take out of our portfolio each year without running out of money in retirement. Yet, as simple as the 4 percent rule seems, the practical implica...
Should Peter LemonJello, who has high income, and his wife, who is retired with zero income, file their taxes as married filing separately so they can start Roth conversions? What are the tax implicat...
Take the time to develop viable sources of lifetime retirement income, then go enjoy your retirement....
One of our listeners actually has a better mortgage rate than me! However, as they begin to test their retirement budget they have found that the mortgage payment leaves that budget a bit tight. So th...
A few weeks ago I wrote How Safe is an 8% Withdrawal Rate? based on some remarks made by Dave Ramsey. In response, a handful of people reached out asking: What would these retirement results look like...
Do financial advisors have some secret blood handshake that they’ll all claim they can get you 8 percent returns, but then tell their clients they can only withdraw 4 percent in retirement? That...
I recently retired with a pension. With my pension and my Social Security, I’m still going to be in a fairly high tax bracket. When I left my government job, I was allowed to roll my IAP 457 ove...
I’m 65 and plan on retiring from full time employment in 26 months. I have a military pension, 900k in retirement savings (mostly in non-Roth, unfortunately), planning on drawing SS when I retir...
Periodically, we read articles from William Bengen, the inventor of the safe withdrawal rate (otherwise known as the 4% Rule), from various esteemed retirement academics, from the retirement researche...
November 12, 2023 – If I wanted to comment on every piece of bad advice in the personal finance community, my quiet, relaxed early retirement would be busier than the corporate career I left in ...
More Americans are resorting to 401(k) hardship withdrawals for income, signaling financial distress in on the rise. But what are driving forces and future indications?...
More Americans are resorting to 401(k) hardship withdrawals for income, signaling financial distress is on the rise. But what are the driving forces and future indications?...
Arguing that we need to delay withdrawals to 75 as a work incentive doesn’t hold water. In a recent meeting I attended, participants were bemoaning the fact that people are reluctant to withdraw...
With today's real yield, a TIPS ladder has become a compelling option for retirees. Here's how either a 30-year or 5-year TIPS ladder could help those in retirement....
Retirement planning consists of 2 broad phases – accumulation and withdrawal. Early retirement is difficult to achieve because there is less time to build wealth and more years to spend. The tim...
The 4% rule is based on a number of critical assumptions. Change any of those assumptions, and you change the results....
Here are five approaches to retirement spending that are better than the 4% rule....
Recently closed a house and after all closing costs, I will have $1m cash on hand. Anticipated Retirement Income: $80,000. Age 60. Anticipated SS: $44,000 annually. 401k: 750k, currently in retirement...
One big issue with early retirement is accessing your retirement accounts. The early withdrawal penalty is 10%. Nobody wants to pay more money to the government, especially from their retirement fund....
It seems that every other article we read these days in the retirement media involves someone’s thoughts about how best to withdraw funds from accumulated savings to supplement income from other...
If you are retired and use a portfolio withdrawal strategy based on a formula, what do you do with unspent withdrawals at the end of the year? Put in a fun fund (spend it or lose it attitude), re-inve...
A record number of Americans are taking hardship withdrawals and tapping into their 401(k)s. According to Fidelity, “Participants taking hardship withdrawals from their accounts rose to 2.4% las...
I'd like to make a full withdrawal from one retirement account. It's a Roth 401k with Fidelity, and though I understand little about retirement (I'm young), I do know that the money is already taxed. ...
When you retire, you will need to switch your thinking from being a saver to being a spender. The trick is to balance your withdrawals from spending too little and potentially dying with too much mone...
Use this free 401k early withdrawal calculator to understand the potential impacts of an early withdrawal on your long-term savings....
The 4% rule can help a retiree determine how much to withdraw from retirement savings each year. Read about the pros and cons of the 4% rule....
Given our current market environment, it's time to rethink the 4% safe withdrawal rule. Today, I explain why, and offer some suggestions....
When clients' retirement transition is harder than they expected, a "ready, shoot, aim" approach to income withdrawals is often to blame. Here's how to fix it.
Advisors may want to rethink one of the industry's retirement rules of thumb. Two researchers suggest swapping the traditional 4% withdrawal rate for a "flexible 3%" rule to lower failure rates for lo...
My husband and I are retired at 60/61. We are trying to bridge the gap between today and Medicare. Today I developed a plan to take a large withdrawal this year and limit income over the next three ye...
An HSA for retirement may help cover future healthcare costs while providing 3 tax advantages: pre-tax contributions, tax-free growth, and tax-free withdrawals for qualified medical expenses. Common H...
Social Security figures and 2026 withdrawal rate research show what three common retirement portfolios can generate in monthly income. The post What $250,000, $500,000, and $750,000 Pay You in Retirem...
Answering listener questions about 529 plans, including how much to save, tax-free growth, withdrawals, Roth IRA rollovers, and what to do with an overfunded account. The post What Doctors Need to Kno...
A financial plan is designed to adapt to life changes, not market changes, helping with how assets are distributed and how withdrawals can reduce taxes.
Don't beat yourself up if you've taken a hardship withdrawal from your 401(k). Here's how you can avoid it in the future.
Maxing out a traditional 401(k) without cash reserves triggers tax spikes and market losses. Here's where and how to save cash for easy retirement withdrawals.
Learn how Roth conversions work, when they may make sense, and how taxes, RMDs, Medicare premiums and withdrawal rules may affect your retirement plan.
New rules could force high-income savers to withdraw "excess" retirement funds. Here is why the bill matters — even if it doesn't pass immediately.
The secret to helping ensure a secure retirement is to create a coordinated strategy for how you'll manage your withdrawals, taxes and healthcare expenses.
An overlooked section lets defined contribution plan participants use funds to pay LTC premiums without early-withdrawal penalties.
Bill Bengen's famous retirement withdrawal rule got an update last year. Here's what changed, and why the number isn't one-size-fits-all.
Retirement planning is often dominated by withdrawal rules, Monte Carlo probabilities, and portfolio‑centric heuristics. But none of these tools directly measure the core financial question every reti...