No. of Recommendations: 5
Thank you Jim.
I'm not familiar with the intricacies of the SEPP rules, but I gather the key question is: given that you need to have sold a specific number of dollars of stock by a specific future date, when should you do that?
For bonus points: using a SEPP, I think you have this problem every year 2029 and later? So you could have a separate table for each future year.
Yes, you nailed it! A SEPP (IRS rule 72t) allows me to withdraw a fixed amount from a tax-deferred retirement account (IRA) before age 59.5 *without penalty*. In my case, I will need to withdraw the fixed amount for 10 consecutive years.
Cool, I will build those tables.
This won't give an optimal solution, but it will give an eminently sensible solution.
Yeah, I don't know what the optimal solution is. I guess it depends on what you're optimizing for. There are just tradeoffs.
I considered:
1) selling the fixed amount once per year; easiest, but likely leaving money on the table, because not a valuation-based decision
2) starting a few years early and selling quarterly to build cash; easy, and would get average prices
2) selling the 10 years worth of withdrawals at once; likely leaving the most money on the table, but sleeping well at night
3) the annuitization method, essentially the same as the tables using a P/B multiplier
Thanks again!
