Message Font: Serif | Sans-Serif
UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev | Next
Author: rjm1 Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 19891  
Subject: Re: 401K Distribution at age 55 Date: 1/23/2000 4:30 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
I recently retired with a $43,000 annual pension for life. I am 55. I have $340,000 in my 401K which have been
earning about 15% a year in a balanced fund. My wife and I also have about $50,000 in IRAs.

According to my 401K administator (METLIFE) I can start withdrawing now from my 401K now without paying a
10% penalty. (I will double check with the IRS)

What would be the best strategy for withdrawing money from my 401K plan (say $20,000 a year)?

Would a varible annuity make sense or would that be too expensive? (I don't like annuities any more than you do -- but
what about Vanguard?)

You have made the decision to take out 20,000 so I guess the question is should you take it out in one or more withdrawls. I would take it out at the beginning of the year (January) if the market is up. If down I would postpone until the market goes up.

I would consider the pension as fixed income investments and get out of the balanced fund into equities. The 20,000 withdrawl is rather high, espicaly if your pension is not inflation adjusted.

The annuitie will only give you certanity and less money. Inflation maybe your biggest problem. Your income may have to double in retirement to keep your purchasing power level.

Read the retire early home page board. Look for withdrawl rate and asset mix posts. Maybe go back one or two thousand posts and skip all that ref IRA, 401k etc.
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev | Next


Foolanthropy 2015!
Fistula Foundation: A World of Good!
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.