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The previous answer leaned toward the term certain method. I plan to use the recalculation method starting at age 70. I have a different policy because of having different goals. Now age 60, I intend to live chiefly off my taxable account for the next ten years, as I have for the past seven years. This will not at all exhaust the taxable account. I will take only smallish withdrawals (around 2%) from the IRA annually in my 60's. Those withdrawals are the best I can do to take the edge off large income tax bills after age 69 without prematurely eroding the tax shelter of the IRA. My policy may differ from yours because I do not intend to leave my IRA to any person, but to a tax-exempt foundation. (National Taxpayer's Union Foundation, to be specific, as a way of expressing my anger that the IRA balance would otherwise be subject to both income taxes and inheritance taxes, leaving only a small fraction for the heirs. NTUF's educational mission is to inform the public about the spending consequences of each Congress member's actual votes, rather than the campaign promises.) I'll reconsider this if, contrary to my expectations, the estate tax is scrapped over Clinton's objections.

With the term certain method, your income taxes are likely to grow every year as your withdrawals do, reaching some amazing heights as you have to take a third, a half and then all the remaining assets out of the IRA in the last three years of the certain term. Of course, you can spread out that tax burden by making withdrawals greater than the minimum required in the earlier years of the term. That would use up the tax deferral even faster.

Chips, whose other potential heirs are people who know how to manage money (and therefore have no need of an inheritance) or who do not know how to manage money (and therefore could be harmed by an inheritance)
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