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Correct government tax wise. There may be associated costs and/or expenses with buying certain funds, no penalties tho.
Correct. And you can withdraw your contributions at any time. Just not the earnings.
Definitely sell.
Agree. That's why my initial thought was traditional 401k.
It's 100% a tax avoidance exercise.
No brokerage account
IMO, it's probably good to have some monies not in pretax accounts. Not knowing anything about your situation, but splitting your 401k halvsies between regular and Roth is worth considering. If you have an inkling of retiring before Medicare age some brokerage account monies would be good, too.
Look at your current tax bracket. If your wife doesn’t work or doesn’t exist, that big pay cut might warrant looking at Roth. My wife and both work and since the tax savings come off our highest bracket, traditional 401k has made sense for a while. Not sure when we are retiring but I do plan to convert as much as possible while we aren’t working before we elect SS. There is a 50% loss in SS if you start before your retirement age and have a high enough income. Once you hit retirement age, income doesn’t matter outside of tax rates on SS monies. You need to manage that all carefully.
Interesting, I don’t see the point in taking money out of the Roth before taking SS. We’ll be using either the rule of 55 or SEPP / 72t to take from our traditional IRA and TSP before RMDs and SS kick in. We might even try to convert funds to Roth before SS or RMDs.
Mine are roughly half and half traditional and brokerage. Never could stuff much into a Roth - maybe 2% there. But with that amount post-tax I have lots of options (and lots of conversions to consider!).
Fwiw, our investments are currently 51% Roth, 39% traditional, 10% regular brokerage. Which is basically perfect for us, although we’re contributing more to the regular brokerage now.
Wife and I started Roth IRA's a long time ago. I am keeping that separate from the discussion.
I thought the rule of 55 was in case you LOST your job. It applies should you CHOOSE to leave?
Well that’s the nice thing about being poor, we had plenty of time to put funds into the Roth accounts.Mine are roughly half and half traditional and brokerage. Never could stuff much into a Roth - maybe 2% there. But with that amount post-tax I have lots of options (and lots of conversions to consider!).
Fwiw, our investments are currently 51% Roth, 39% traditional, 10% regular brokerage. Which is basically perfect for us, although we’re contributing more to the regular brokerage now.
You don’t need to get fired, just leave the year you turn 55.
BUT, if you do so choose to get fired, then please check back in. We'll all contribute on what to say to your boss to get yourself fired but good.
Well that’s the nice thing about being poor, we had plenty of time to put funds into the Roth accounts.Mine are roughly half and half traditional and brokerage. Never could stuff much into a Roth - maybe 2% there. But with that amount post-tax I have lots of options (and lots of conversions to consider!).
Fwiw, our investments are currently 51% Roth, 39% traditional, 10% regular brokerage. Which is basically perfect for us, although we’re contributing more to the regular brokerage now.
You don’t need to get fired, just leave the year you turn 55.
Good call. There’s a fair chance I wait until our youngest is in college, I’ll be 57Well that’s the nice thing about being poor, we had plenty of time to put funds into the Roth accounts.Mine are roughly half and half traditional and brokerage. Never could stuff much into a Roth - maybe 2% there. But with that amount post-tax I have lots of options (and lots of conversions to consider!).
Fwiw, our investments are currently 51% Roth, 39% traditional, 10% regular brokerage. Which is basically perfect for us, although we’re contributing more to the regular brokerage now.
You don’t need to get fired, just leave the year you turn 55.
…or later.
About 6% here. Will have lots of conversions.Mine are roughly half and half traditional and brokerage. Never could stuff much into a Roth - maybe 2% there. But with that amount post-tax I have lots of options (and lots of conversions to consider!).
Fwiw, our investments are currently 51% Roth, 39% traditional, 10% regular brokerage. Which is basically perfect for us, although we’re contributing more to the regular brokerage now.
It was more the case of didn't rather than couldn't. Oh well, can't win them all.
So I know a guy that gets a new Roth account every year to keep track of which hit 5 years when.
I have no idea why someone would do that to themselves. There is a 5 year timer on the account itself, so that ain't it. Then a 5 year timer on conversion monies. Excel seems perfect there.
Yeah, it's the conversations. Which I plan to start doing next year.
I would think you could just check your transaction history when considering a distribution and act accordingly.
to excel. It starts with weekly record of all my accounts since 2007 and goes from there.
UTMA accounts. Get them into Fidelity and at least get the ~4% the money market offers.
That's what I was getting at with same asset allocation with different (but the same) funds each year. Etfs one year, same thing but in the mutual fund version the next hear switch from vanguard to Fidelity funds in year 3 etc etc.
doesn't utma count more on fafsa?
I generally lean to taking it sooner. If you're already older and gonna work until that age anyway...part of me says if you don't need the money then it comes down to your own risk tolerance.
Unless there’s a huge difference I tend to agree.
