Grhog - 1/23/2019 18:41

Very interesting retirement plan. 1.5 years out here so I am a little more worried about a sizable correction so went 85% CD and money market with the balance in indexed fund. Thinking of pulling the plug. But to ladder into low return investments not very exciting. Most bonds kinda lock you in to longer term. Will not be able to pull land rent payment for 6 more years so I need a income stream till then. Hoping to work half time if income limits are not a deterrent.[/QUOTE I thought about your situation for a little bit trying to come up with a viable solution so you can go fishing and play golf while working part time for the next six years, and provide you and your spouse ( I assume your married) adequate income for life. Here goes.... And I’m gonna have to make a few assumptions along the way, but you’ll grasp the concept; Take the highest basis 80 you own (assuming no debt against it) and sell it. Let’s assume this 80 sells for $7,000 acre, for $560,000 total. Let’s say you’ll owe a little tax,10% cap gains, leaving $504,000. Take half the proceeds and put it in something, doesn’t really matter what, as long as not paying an upfront sales charge, and make withdrawals of 1/6 of the account balance each year.(this income stream will be virtually income tax free, as it’s almost all a return of your own money) This will bridge your six year hurdle. This should provide around $43,000 each of those six years. (You mentioned working part time for a few years to make up the difference) Take the other $252,000 and purchase a deferred annuity to age 80. Assume a 5% return for 21 years ( guessing you’re 59 now?) and it will grow to a little over $713,000 as it’s tax deferred. Between the age of 65 and 80, (quit work altogether at 65) spend all your qualified plan retirement savings via systematic withdrawals in your favorite investment of choice, could be the market even, as risk is greatly mitigated cuz the money only needs to last you for 15 years till age 80, at which time you turn on the income of the annuity in life only single or joint and survivor. (highest payouts, but could choose period certain also) As a single person, this would be about 10% per year of the account balance for as long as you live. If you still have a living spouse, it would be somewhat less because of having to guarantee over two life expectancies. You most likely should have a very good income stream between 65 and 80 with the retirement plan payments, remaining land rent, and Social Security. Life will be good, and you get to retire six years sooner than you otherwise thought. And never run out of money.

Edited by Boone & Crockett 1/25/2019 02:35