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Author: GINVS Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308557  
Subject: Retirement Account Date: 10/4/1999 11:51 PM
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I read "Susan's" attempt of reducing $8,000 worth of debt by accessing her 40lK. My situation is similar.
I've paid off our debt. However, we leased a truck that we want to keep when the lease runs out; l5 months. The payments are close to $500 per month. I have approximately $l7,000 in American Funds which will pay somewhere in the neighborhood of l,300 in capitol gains after the first part of the year. My thoughts were to pull the money out of the portfolio and pay off the truck thus saving myself $500 per month. I'm 60 years old and thought I would only have to pay taxes on the money taken out? I really hate to pull the money out of the IRA account but thought it wise to eliminate a $500 bill.
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Author: JABoa Big gold star, 5000 posts Feste Award Nominee! Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 16951 of 308557
Subject: Re: Retirement Account Date: 10/5/1999 7:00 AM
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I'm a bit confused. If that money is in a 401(k) or IRA, it is going to come out as ordinary income and be taxed at 28% or whatever your bracket is. In that case, capital gains are irrelevant.

Be that as it may, as I understand it you can remove money from an IRA after age 59 1/2 with no penalty, and you don't have to do it according to any particular schedule (as you would have to, if you didn't start removing until age 70 1/2).

You probably want to ask again on the Retirement Investing board.

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Author: TMF2Aruba Big funky green star, 20000 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 17001 of 308557
Subject: Re: Retirement Account Date: 10/5/1999 5:14 PM
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My thoughts were to pull the money out of the portfolio and pay off the truck thus saving myself $500 per month. I'm 60 years old and thought I would only have to pay taxes on the money taken out? I really hate to pull the money out of the IRA account but thought it wise to eliminate a $500 bill.

Hi GINVS!

Your situation is different from Susan's as you're over 59 1/2 years of age, and therefore there's no penalty for you withdrawing from your retirement account.

You're correct in that you'll only be paying taxes on the money and it's taxed at your ordinary income tax rate.

Of course your decision should be based on whether withdrawing from your IRA now is worthwhile to you as opposed to letting the funds grow for your later years.

Good luck!

Tony
...but I still am...

Off2Aruba

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