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Knowing The Right Amount To Withdraw From Your Accounts In Retirement

 

Choosing The Best Distribution Method For You In Retirement

Have you considered these factors to understand how much you'll need in retirement:

How long will you be retired for? (Are you planning to retire at 60, and live to age 80? What happens if you make to 81, 82...83???)

What are inflation numbers going to look like when you retire - or 5 years, 10 years, or more in to your retirement?

Are you confident that you'll be able to live off the interest that your retirement accounts will generate in retirement? (There's no way another 2001, 2008, or March of 2020 will happen again...right?!?)

In this episode of After The Paycheck, Sam and Adam focus on determining what the best options of withdrawing money from your retirement accounts should be when considering these issues, and discuss:

  • The types of distribution methods there are
  • How to determine which is the right method for you
  • Some rules you need to understand as you weigh your options for your distribution method(s)

So, what are the types of distribution methods? (and what are the pros/cons of each?) You could:

  • Stay put (leave your money in their accounts so they can grow)
  • Take a lump sum (withdraw ALL of your money at once so you are entirely in cash)
  • set up systematic withdrawals - your options include:
    • a standard dollar amount ($40,000 a year, every year)
    • a percentage of your account's value (4% of your account every year)

How can you determine what type of method is right for you?

Sam discusses his "3 bucket approach" for withdrawal options to help address those unknown factors about your retirement length, market volatility, and inflation needs.

What are some distribution rules that you need to consider before making a choice?

  • Required Minimum Distributions (what are they? How are they calculated?)
  • SECURE Act & Inheriting IRAs (what changed? What does that mean if you inherit one? If you leave one to a beneficiary?

Looking to download to our monthly budget / income gap worksheet? Click here for access!

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Have a list of questions around your finances? Thinking about your retirement situation?

Let’s chat. Fill out the form below or request a time on our calendar to reserve a 15 min. phone call with either Sam, John, or Ryan - we'll use this time to get to know you and your needs and talk about the retirement planning obstacles you may be facing.