You may have just one major investment account, or you may have a variety of sources, such as a
401(k),
403(b),
or other defined contribution plan, a traditional or
Roth IRA,
mutual funds,
or
annuities.
As many investors do, you may have the bulk of your investments in a
retirement account with tax advantages, such as a 401(k) or IRA. You
may have taxable investments as well.
Naturally,
your withdrawals need to help you meet your basic living expenses. But
they should also support your continuing investment strategy and
minimize your tax bill, if possible. If you have a
minimum required distribution (MRD),
you run the risk of owing tax penalties if you take out too little. But
if you take out too much too quickly, you run the most serious risk:
running out of money.
Choices for withdrawals
With many, though perhaps not all of your accounts, you have several options
for withdrawing your money:
