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    March 8, 2013
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AskKen's Answers
1 2 3 4 5 ... 26 next>>
 

what is my MRD % for 2014???

Thank you for your question about determining your minimum required distribution (MRD).

You can find your MRDs by visiting the Retirement Distribution Center (RDC) at Fidelity.com/RDC. There is an estimated MRD for each account calculated for you, starting the first year you reach age 70½. As long as Fidelity has the correct date of birth for you and your spouse (if you are married), the year end balances are correct, and the beneficiary information is correct, then those estimated MRDs are correct. Every year on January 1st or soon thereafter, the RDC will calculate your MRD for that year and track the distributions you take.

We have a great general article about how MRDs are calculated: https://www.fidelity.com/retirement...

We also have a series of frequently asked questions about MRDs: https://www.fidelity.com/retirement...

Please contact us if you have additional questions about your MRDs.

I hope this helps.

Ken
1 week, 1 day ago
by
AskKen
 

dividend reinvestment

Is there a way in my retirement on-line account to receive my dividends in the form of stock. What do I need to do to make this happen?
Thanks for your question. Setting up a dividend reinvestment program for holdings in your Fidelity account is easy and straightforward. Here are the basic steps.

1. Log in to your account on Fidelity.com.
2. Locate the account that holds the positions for which you wish to set up dividend reinvestment plans.
3. Click the Select Action link, and choose Update Accounts from the dropdown list.
4. This will take you to the Update Accounts/Features page. Under Account Features, select Dividends and Capital Gains.
5. A list of all positions in your accounts will be presented with the status of whether or not dividends and capital gains are Reinvested or Deposited to Core Account.
6. If you want to change the status, simply click on the Update link under Action and choose the new desired status.

As always, feel free to call one of our service representatives at 800-343-3548 who would be happy to help guide you through this process.

Thank you for your question.

Ken
1 week, 1 day ago
by
AskKen
 

what are the RMD requirements for Keoghs and 401A plans

I have a traditional IRA, a Roth, a Keogh, and a 401A plan. From which accounts must I take RMDs, and do I use Table III to calculate RMDs for all cases? Thank you.
Thank you for your question about your minimum required distributions (MRDs).

MRDs will be required for your Traditional IRA, Keogh, and 401(a) plan. Only the Roth IRA will not have MRDs during your lifetime.

In general, you must start taking MRDs beginning the year in which you turn 70½. For certain employer-sponsored plans, you may be able to delay starting withdrawals if you own less than 5% of the company and are still working at the company.

You might find some additional helpful information in this great general article about how MRDs are calculated: https://www.fidelity.com/retirement...

Please note that the Table III you mention is called the Uniform Lifetime Table in our article.
You should also visit our Retirement Distribution Center (RDC) on Fidelity.com to see each MRD calculated for you once you turn 70½. The RDC automatically recalculates your MRDs on January 1st each year and tracks all your distributions and tax withholding from those accounts. The RDC also links to educational and news articles, and has links to automatic withdrawal options for helping you take your MRD from your accounts. You can visit the RDC at www.fidelity.com/RDC

If you would like to estimate what your combined MRDs might be, you can do this by using our MRD Calculator at: https://www.fidelity.com/calculator...

Our retirement representatives would be happy to assist you with any additional questions you may have.

Ken
4 weeks ago
by
AskKen
 

Does the annual MRD calculation include the value of Roth IRAs?

I have a regular and a roth IRA. Is my total MRD based upon the sum of them even though I can take the entire MRD from the regular IRA?
Thank you for your question about rules for minimum required distributions (MRDs). According to IRS rules, minimum required distributions do not need to be taken from Roth IRAs during your lifetime.

If your IRAs are with Fidelity, you should be able to access our Retirement Distribution Center (RDC) on Fidelity.com. In the RDC, you will see an MRD amount for your Traditional IRA, but none for your Roth IRA. The RDC recalculates your MRD automatically on January 1st each year. It also tracks all your distributions from those accounts, including the federal and state tax withholding. The RDC also links to educational and news articles, and has links to automatic withdrawal options for helping you take your MRD from your accounts. You can visit the RDC at www.fidelity.com/RDC

Here is a series of frequently asked questions about MRDs that you might find helpful: https://www.fidelity.com/retirement...

Our retirement representatives would be happy to assist with any additional questions you may have.

Ken
4 weeks ago
by
AskKen
 

Can I withdraw from my IRA w/o a penalty

I'm considering using a portion of my IRA funds to purchase a home.
what's the max I can withdraw..I'm currently 62
Thanks for asking about IRA withdrawal rules.

If you have a Traditional IRA, then you will not be subject to the 10% early withdrawal penalty since you are over the age of 59½. Keep in mind, however, that with a Traditional IRA you will generally owe taxes on the amount withdrawn.

If your IRA is a Roth IRA, withdrawals are tax-free, and you will not be subject to the early withdrawal penalty for withdrawing any of the contributions from your account. However, if you are withdrawing any earnings or interest from your account, the account—or any of the Roth IRAs you own—must have passed the five-year aging point. The five-year aging rule starts on January 1 of the calendar year of your first contribution into the account. As long as your withdrawal of any earnings or interest is after January 1 of the fifth year, and since you are age 62, then you are not subject to early withdrawal penalties.

For either the Traditional or the Roth IRA, there is no limit for the amount you can withdraw since you are over age 59½. Please contact Fidelity if you want to discuss any additional questions you might have.

Ken

Important Additional Information:
A distribution from a Roth IRA is tax free and penalty free, provided the five-year aging requirement has been satisfied and one of the following conditions is met: age 59½, disability, qualified first-time home purchase, or death.
4 weeks, 2 days ago
by
AskKen
 

Changing to Fidelity SIMPLE IRA from 401k

I am a small business owner frustrated with my 401k TPA and financial advisor. I want to switch back to a Fidelity SIMPLE IRA for myself and all of my employees (6) and manage it ourselves. Another financial planner told me it is legal to switch from 401k to SIMPLE mid-year, but your form says it cannot be done in the same year. Which is true?
Thank you for your question about a Fidelity SIMPLE IRA plan for your small business. IRS rules state that an eligible employer must not maintain any other employer-sponsored retirement plan for the same calendar year in which a SIMPLE IRA plan is maintained. Generally, an employer is considered to have maintained the plan if contributions have been allocated to the plan that year. Here is a link to the IRS FAQs about SIMPLE IRAs: http://www.irs.gov/Retirement-Plans...

In other words, you must wait until the end of this calendar year to establish SIMPLE IRAs for your employees. When that time comes, please contact a Fidelity retirement representative at 800-544-5373 and we would be happy to assist you with this process.

Ken
4 weeks, 2 days ago
by
AskKen
 

When can I withdraw recent contributions without penalty?

At age 78 and still producing earned income and wish to continue adding to my Roth IRA that has been in existence since Roth was invented, when can I withdraw recent contributions without incurring a penalty? Do all contributions become eligible for withdrawal based on the date the IRA was first opened?
Hi Warren,

Thanks for your question. You can withdraw any of the contributions to your Roth IRA penalty-free at any time because of your age. After age 59½, you can also withdraw any earnings penalty and tax-free once the five-year aging requirement is met. The clock for the five-year aging rule starts on January 1 of the year that the account was first funded and it does not reset for subsequent contributions.

Ken
1 month, 1 week ago
by
AskKen
 

Company Roth 403(b) and personal Roth IRA

I am contributing to my company 403(b) ($12K per year) and Roth 403(b) ($5200 per year). Can I also open a personal Roth IRA? If so, what would be the maximum yearly contribution I could make to the personal Roth IRA?
Hi Eric,

Thanks for your question. A Roth IRA is a great way to supplement your workplace retirement savings and yes, you can still make Traditional or Roth IRA contributions even if you are contributing to, or even maxing out, your workplace plans.

The maximum Roth IRA contribution amount for 2014 is $5,500 if you are under age 50 or $6,500 if you are age 50 or older.

You’ll also want to make sure you qualify to make Roth IRA contributions, since the IRS has established income limits based on your tax filing status. To find out if you qualify you can use our IRA calculator here: https://scs.fidelity.com/products/m...

Ken
1 month, 1 week ago
by
AskKen
 

I am retired, age 67, and currently have a roll over ira with Fidelity. Are there any tax free wihtdrawal options with this type of account?

Thank you for the question regarding your Rollover IRA.

Since you are over age 59½, all distributions are allowed by the IRS and would not have the 10% early withdrawal penalty for you.

However, the withdrawals are considered ordinary income so will be taxed at your applicable tax rate. If you made any non-deductible, or after-tax, contributions to your IRA, you will generally not pay income tax on those withdrawals. You may want to consult with your tax advisor regarding your specific situation.

One thing to note, you will be required by the IRS at age 70½ to begin taking minimum required distributions (MRDs) for this account.

You can track your distributions in our Retirement Distribution Center available at: www.fidelity.com/RDC and find links to helpful articles and tools. There is also a countdown to the year you will be required to start MRDs for your account.

You can always contact Fidelity to review your retirement income needs and answer any additional questions you may have. To speak to one of our retirement representatives, call 800-544-4774.

Hope this helps you.

Ken
1 month, 1 week ago
by
AskKen
 

I am 6 to 18 months away from retirement

I am ready to move my balances into
Treasury Inflation-Protected Securities (TIPS) what does Fidelity have to offer for me
Congratulations on making it to the “home stretch!” We offer both new issue and secondary market Treasury inflation-protected securities (TIPS). Inflation is one of five key risks, along with longevity, withdrawal rate, asset allocation, and health care expenses, that we believe all investors should address as part of their retirement plans. TIPS are certainly an investment vehicle that can help mitigate the risk of losing buying power over a long retirement. As part of our overall bond and fixed income investment services, we have a center on our website that you can use to research and purchase TIPS. We also have fixed income specialists you can talk with over the phone.

To access TIPS from our fixed income/bond site, go to www.fidelity.com, select the green Research tab at the top of the home page, then Fixed Income & Bonds. Under the heading Find Bonds and CDs, you will see a link for Individual Bonds just above the Yield Table. Select that link, and then you can begin searching for the TIPS you are interested in.

If you select Secondary Markets, you can modify some of the variables but since the universe of TIPS is small and finite you may as well choose a appropriate maturity and go straight to the Find button to see your results. Note that the earliest maturity we offer is 2021. This is because of the challenge of the shorter maturities having a negative yield, so we filter those out. That notwithstanding, as of today, there are 20 secondary TIPS available from 2021–2044.

We also offer periodic auctions on TIPS—that is, to purchase them as a new issue. The best way to stay informed here is to sign up for new issue fixed income taxable alerts and you’ll be sent an alert ahead of the auction date. Visit the following page to find out more about fixed income alerts and to sign up: https://www.fidelity.com/fixed-inco...

Please don’t hesitate to set up an appointment with us if you want to review your overall retirement income plan. As I mentioned, we believe all investors should go into retirement with their eyes open. If you would like to bounce some ideas off one of our specialists, I would suggest calling a fixed income specialist at 800-544-5372.

I hope this helps.

Ken

Important Additional Information:
Lower yields - Treasury securities typically pay less interest than other securities in exchange for lower default or credit risk.
Interest rate risk - Treasuries are susceptible to fluctuations in interest rates, with the degree of volatility increasing with the amount of time until maturity. As rates rise, prices will typically decline.
Call risk - Some Treasury securities carry call provisions that allow the bonds to be retired prior to stated maturity. This typically occurs when rates fall.
Inflation risk - With relatively low yields, income produced by Treasuries may be lower than the rate of inflation. This does not apply to TIPS, which are inflation protected.
Credit or default risk - Investors need to be aware that all bonds have the risk of default. Investors should monitor current events, as well as the ratio of national debt to gross domestic product, Treasury yields, credit ratings, and the weaknesses of the dollar for signs that default risk may be rising.
1 month, 1 week ago
by
AskKen