UnThreaded | Threaded | Whole Thread (28) | Ignore Thread Prev Thread | Prev | Next | Next Thread
Author: inparadise Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76421  
Subject: Re: RMDs for Roths? Date: 3/11/2014 1:57 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
Not with respect to the question about changing the rules to increase federal revenue. If a large percentage of non-spousal beneficiareis are not using the "stretch" then abolishing the "stretch" would not raise that much more federal revenue.

Said another way, if only a small percentgage of most non-spousal beneficiaries are stretching withdrawals past five years per the "stretch" rule, how much more revenue would abolishing the "atretch" rule acutually raise?

Regards, JAFO


Are you still talking about Roths, or have we switched the topic to TIRAs?

I totally get what you are saying, but if continuing on with the inherited IRA vs cashing it in really depends on the individual circumstances, unless you find a predictable trend then all you would get in a survey would be a snap shot in time, rather than a predictor of future behavior. Can you really extrapolate that data set forward, when there are so many variables involved with the individual choice? For example just in my family alone you had the following: N-stage cancer, underemployment and debt, kids' college tuition, under water home, impending retirement. These are a few reasons some of my siblings chose not to continue on with the IRA.

One requirement of a valid experiment design is to make sure that the data you collect actually addresses the hypothesis in question. I could be wrong, but I question that. Has there actually even been all that many IRAs that have been available to be inherited? It's still a relatively new product, one that required time to be built, and the passing on of the originator and their spouse. Add to that the general investor still trying to recover from the not so distant downdraft in the market that sent them scrambling out of their stocks at a low.

It would be a shame to see one of the few ways in which we have been encouraged to save be pulled from our tool belt, particularly amid the hue and cry about the "crisis" in retirement savings and the talk about a need to ween oneself off of the dependency on social security, particularly for the generation who recently started working.

I am looking very closely at where all this is headed to figure out how to advise our kids when they start having options for putting money away for retirement. One of the talking points has always been the IRA's use in inheritance. For us it made even the TIRA worthwhile, but without the stretch provision? Probably not.

IP
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (28) | Ignore Thread Prev Thread | Prev | Next | Next Thread

Announcements

The Retire Early Home Page
Discussion on accelerating retirement day.
Foolanthropy 2014!
By working with young, first-time moms, Nurse-Family Partnership is able to truly change lives – for generations to come.
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.
Post of the Day:
Macro Economics

Looking at Currency Ratios
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 "#1 Media Company to Work For" (BusinessInsider 2011)! 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.
Advertisement