https://www.bogleheads.org/wiki/Roth_conversionThat's something I hadn't considered. Could you please elaborate a bit more? Basically I'll roll over my pre-tax 401K to traditional IRA, and then convert to Roth IRA. Not all at once but to a certain amount per year to create "income" for ACA purposes?They absolutely should do Roth conversions. (Not sure whether that counts as "untouched" in your mind). Whether they should do withdrawals depends on the situation. It may be worth it if they need to control their AGI to keep ACA subsidies, for example.I didn’t say they couldn’t I said they shouldn’t. Particularly in this case.The FIRE subs would indeed be good sources of info for correcting the misperception that retirement accounts cannot be accessed before 59.5. Roth conversions are a great tool for early retirees.If I read this right you have 650k in tax advantaged accounts that really shouldn’t be touched till 59.5, yes there are ways to access but I would be looking at the 1.4 million in taxable ( assuming that’s accurate) as your live off money and bridge to traditional retirement age. 1.4 x 4% is about 56k a yr.
Generally you need a bigger buffer or lower SWR the younger you Fire or you are willing to supplement with work or go back full time if things turn bad. It’s doable but it’s on the bubble as a long term plan IMO. Sequence of returns risk can really make a mess of things if you don’t have a good buffer built into the plan. Drawing down into a shrinking port can be disastrous long term.
If you want a more detailed rundown, I’d recommend posting in a few of the Fire subs on Reddit.
Statistics: Posted by cmr79 — Sat Sep 14, 2024 11:03 pm — Replies 52 — Views 2533