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Reinvesting Dividends and Interest after Retirement
I just lately retired and have began drawing from my IRA and 401K plans. I used to be questioning concerning the knowledge of constant to reinvest dividends and curiosity from the varied funds or just redirecting them to the Money/Settlement accounts. I am undecided it makes a lot distinction, however I might have an interest if anybody may share their ideas on this – benefits/disadvantages/different.
Thanks…..
Re: Reinvesting Dividends and Interest after Retirement
When you intend to spend the money, direct it to settlement. I did that for first a number of years of retirement. I used the money for spending. Now that SS and Pension are in full swing, I’ll probably reset them to reinvest. Ready to get all of the accounts fully transitioned to brokerage and slightly extra consolidation to simplify the entire thing. Most likely by the tip of the yr.
Whenever you uncover that you’re using a lifeless horse, the most effective technique is to dismount.
Re: Reinvesting Dividends and Interest after Retirement
In taxable accounts it does not make sense to routinely reinvest in case you are spending out of the accounts since that can result in one other taxable transaction. When you aren’t spending out of the account it issues much less however I choose to pool distributions and purchase the property I need at the moment slightly than passively have them reinvested the place they got here from.
Re: Reinvesting Dividends and Interest after Retirement
I’m topic to Required Minimal Distributions (RMDs) due to this fact, in my IRAs, all dividends are directed to the settlement fund which then are principally withdrawn as I full the yearly Certified Charitable Donations and the RMD. This avoids having to decide on which fund to promote at a selected time to fulfill a deadline. This will not be a strictly rational method however it’s straightforward to implement and offers me peace of thoughts.
Tortuga
