Take your Required Min. 401k/IRA this year?

[Kirk W]

Since the new CARES act has suspended the RMD requirement for this year, do you plan to take advantage of that action, and if so, in what way? I have been reading various "authorities" on the subject and just wondered what those in the forums plan to do?

[ARGO]

Wife got RIF'd 12/31, so we're taking as little income as we can. No, I won't take RMD. Now we qualify for all the freebies that the greedy have been getting for years

[trailertraveler]

In addition to the one year deferral in the Cares Act, the Secure Act changed the age requirement for those that would turn 70.5 in 2020 to 72. 

[dewilso]

Damn, already took mine. Took it when the market was up.

[Barbaraok]

So did we.  And that's the best time to take it.  Lower # of shares sold to satisfy the RMD.   Plus, used it to make sure we had all expenditures for the coming year covered.   

[Sehc]

Plus. What happens to tax rates after we get past this crisis? The stimulus's will have drained the treasury.

[Ray,IN]

I only withdrew the RMD up to now because there was no practical alternative. The exception is only this year though, then it's back to RMD directly into a savings acct.= lose money on the transfer.

 

[Barbaraok]

Why don’t you take RMD and reinvest it into a similar, if not the same, mutual fund.  At the very least into a money market fund.

[edatlanta]

I'm going to sit this out and see how fast the market recovers.  I have not taken my RMD this year and may or may not depending on what happens between now and the end of the year.  I have approx half of my losses recovered on existing investments right now so I wasn't hurt too bad.  I don't need the withdrawal so I'm sitting tight......

[Barbaraok]

You didn't take any losses?  I had one fund I wasn't that happy with, so we will have a loss next year and I used that money to payoff car since loan rate was now greater than what we were making off investments.  

[Kirk W]

4 hours ago, edatlanta said:

I'm going to sit this out and see how fast the market recovers.  I have not taken my RMD this year and may or may not depending on what happens between now and the end of the year.  I have approx half of my losses recovered on existing investments right now so I wasn't hurt too bad.  I don't need the withdrawal so I'm sitting tight......

Me too.  😷

[Ray,IN]

22 hours ago, Barbaraok said:

Why don’t you take RMD and reinvest it into a similar, if not the same, mutual fund.  At the very least into a money market fund.

Thanks for the suggestion, I'll keep that in mind for next year.

[RV_]

i divested and then did a small investment in pot stocks that I expect to take a few years to give good yields. I am waiting with cash for the crash, then going into index funds with half and half in cash. I'll keep my small investments in stocks in ACB and NBEV for at least five more years barring another surprise like this pandemic. In that scenario timing the market perfectly is not required IMHO. I am opting out of gasoline and should take delivery of my Model Y in a couple of months or less.

Good luck all!

[rynosback]

21 hours ago, RV_ said:

i divested and then did a small investment in pot stocks that I expect to take a few years to give good yields. I am waiting with cash for the crash, then going into index funds with half and half in cash. I'll keep my small investments in stocks in ACB and NBEV for at least five more years barring another surprise like this pandemic. In that scenario timing the market perfectly is not required IMHO. I am opting out of gasoline and should take delivery of my Model Y in a couple of months or less.

Good luck all!

I’m still on the sidelines with most of my cash. I put a little into a few stocks about a week after the dip. But I think there is another coming. There is NO reason that the market should be this high. I know the Fed has poured TRILLIONS into it, but that still does not change the fact that is it where is it. The NASDAQ has made a V recovery!! WHAT??

[RV_]

My usual stash for cash in case of a crash was money market accounts to do a lot  better than USAA savings accounts. (I'm alliterate! ) what bothers me about my money parking is that with trillions more federal debt, I expect the dollar to lose value eventually. You can lose big in money markets if the dollar loses value from 1:1. So I'm going to keep low six figures in cash but buy a Tesla, have a small 10X16  workshop built on my new Colorado property. In other words, starting next year, when I hope working vaccines are out, we'll travel, and start looking for a vacation home/retreat/final downsizing place for when one of us goes. While the Tesla is a depreciating asset, not by much historically. Risky times!

 

[rynosback]

2 hours ago, RV_ said:

My usual stash for cash in case of a crash was money market accounts to do a lot  better than USAA savings accounts. (I'm alliterate! ) what bothers me about my money parking is that with trillions more federal debt, I expect the dollar to lose value eventually. You can lose big in money markets if the dollar loses value from 1:1. So I'm going to keep low six figures in cash but buy a Tesla, have a small 10X16  workshop built on my new Colorado property. In other words, starting next year, when I hope working vaccines are out, we'll travel, and start looking for a vacation home/retreat/final downsizing place for when one of us goes. While the Tesla is a depreciating asset, not by much historically. Risky times!

 

I parked a bunch in a 1 year CD at 2.2%. 

[RV_]

Where?

 

[Kirk W]

5 hours ago, rynosback said:

I parked a bunch in a 1 year CD at 2.2%. 

When we sold some property we put $100k+ into a "stepped" money market account. It is called that because the CD's each have a different maturity date, thus gradually returning to cash. We have reached an age where our funds are unlikely to need to last more than 25 years so have begun to spend down. 

[ms60ocb]

I took about half in January. The other half would be a CD that expires this fall. The plan was to cash it in, then the market fell and the CARES Act has made me wonder. The plan is still cash in to full fill the RMD. My  wife is also taking RMD . But we have 5-7 months to change our minds.

Clay    Good Lord only knows whether we will on Earth come 2021

[rynosback]

12 hours ago, RV_ said:

Where?

 

This was back in March with Able bank. They were the highest out there at the time with no exclusions. Now it looks like they are .6% !! 

[RV_]

See what I mean?

 

[rynosback]

20 hours ago, RV_ said:

See what I mean?

 

See what I mean?

[justRich]

My feeling is that the Wile E Coyote stock market has run off a cliff and is now temporarily suspended in mid air.
The Fed can print money to inflate prices, (and to keep the stock market up) or so it seems.  The .06% interest rate would indicate "deflation".
If you remember the days of 10+% CD rates - that was inflation.
Now, I'm not so sure. . .

As for the RMD - I'm in a somewhat unique situation - and will not take the RMD this year on the chance that the market will ratchet up a little more.
(Unique: an IRA inside a variable annuity that is tied to the stock market value with an annual "locked in" upside and no downside)

[sushidog]

I'm still riding the roller coaster. I rode it down and am riding it back up but still have a ways to go, as I'm heavily in the energy sector (about 1/3 of my portfolio 🙁). The indices are catching up, especially the NASDAQ, giving me hope. I still have about 2 years before I need to take some out, so I think I'll be OK. Who knows what will happen by then, but I think there's still opportunity there. No? Time will tell.

Chip

  

[Ray,IN]

sushidog,  the POTUS, in late April predicted 12-14 years to complete- full recovery. I'm not as optimistic, 20 is my guess. Twelve years would make me 90, so I'm not gonna be around to see who is right.. IMO the stock market has no resemblance to reality.

IMO the rich are going to get richer, middle/working-class will get poorer. The middle-class will have to sell to survive, the rich will buy; the gap widens. I may have to sacrifice  life-style but I'm hanging on, so far.

Edited May 29, 2020 by Ray,IN