Re: how to compare living standards

On Tue, 18 Apr 2006 12:58:45 -0500, "Jim Blair" <jeb@xxxxxxxx> wrote:

"William F Hummel" <wfhummel@xxxxxxxxxxx> wrote in message

As a general rule, your estate should be the beneficiary of your IRA,
not your spouse. As for IRA distributions, you must pay income tax as
ordinary income. And if the residual after tax, when added to the
estate, causes the value of your estate to exceed the exemption limit,
your heirs will have to pay a Federal estate tax on the excess amount.
Of course that assumes you don't spend any of the money from the IRA
distributions during your lifetime, which is highly unlikely.

I would like to live long enough to spend it all ;-).

That's no problem. The trick is to spend the last dollar on the day
you die.

(And die broke--saying it that way does not sound as good :-(

I plan to take the minimum distribution required by the IRS (since I will
soon be 70.5) and was suprised to see that the total value will continue to
increase for many years, as will my annual payments. (but maybe not in real
dollars) My annual nominal distribution won't decline until I am about 95,
so I better get my wild partying out of my system before then.

I suspect you mean the balance in the IRA (rather than the annual
distribution) won't decline until then. The percentage you have to
distribute grows each year. By age 95 it is over 50%. That's far
more than the IRA balance will earn in a year.

My IRA has been growing too since I am withdrawing the minimum
required each year. It is 100% in equities, so I have no way of
figuring when the balance will decline. It all depends on how the
stock market fares down the line.

.

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