Required Minimum Distributions

Retirement Readings

March 23, 2016

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CALCULATING REQUIRED MINIMUM DISTRIBUTIONS

The objective of the required minimum distribution rule is to ensure that the entire value of a traditional IRA or employer-sponsored qualified retirement plan account will be distributed over the IRA owner’s/retired employee’s life expectancy. IRS regulations include a “Uniform Lifetime Table” that is generally used to calculate the required minimum distributions that must be made from qualified plans, including 401(k) plans, Section 403(b) annuities and regular IRAs.To calculate your annual required minimum distribution, follow these simple steps:

Example:

Step 1:

Account balance as of the previous December 31:

$______ $200,000

Step 2:

Distribution period factor based on your age as of December 31 in the year for which the distribution is being calculated:

25.6

Step 3:

Divide Step 1 by Step 2; the result is your annual required minimum distribution for the year:

$______ $7,812.50

Uniform Lifetime Table:

Age

Distribution Period Factor

Age

Distribution Period Factor

Age

Distribution Period Factor

70

27.4

86

14.1

102

5.5

71

26.5

87

13.4

103

5.2

72

25.6

88

12.7

104

4.9

73

24.7

89

12.0

105

4.5

74

23.8

90

11.4

106

4.2

75

22.9

91

10.8

107

3.9

76

22.0

92

10.2

108

3.7

77

21.2

93

9.6

109

3.4

78

20.3

94

9.1

110

3.1

79

19.5

95

8.6

111

2.9

80

18.7

96

8.1

112

2.6

81

17.9

97

7.6

113

2.4

82

17.1

98

71

114

2.1

83

16.3

99

6.7

115

1.9

84

15.5

100

6.3

and later

85

14.8

101

5.9

 

 

EXCEPTION: If your beneficiary is your spouse who is more than 10 years younger than you, instead of this table you can use the actual joint life expectancy of you and your spouse from the IRS Joint and Last Survivor Table to calculate required minimum distributions.

NOTE: The above discussion does not apply to non-deductible Roth IRAs, which are not subject to minimum distribution requirements.

Please contact my office if you would like additional information on required minimum distributions.

MESSAGES from the Masters…

YOU DESERVE TO BE HAPPY by Brian Tracy

Achieving your own happiness is the best measure of how well you are living your life and enjoying your relationships.

EVERYONE IS DIFFERENT

Happiness in life is like a smorgasbord. If 100 people went to a smorgasbord and each put food on their plate in the quantity and mix that each felt would be most pleasing to him, every plate would be different. Happiness is the same way. Each person requires a particular combination of those ingredients to feel the very best about himself or herself.

LISTEN TO YOUR HEART

And your mix is changing continually. Therefore, the only way to judge whether a job, a relationship, an investment, or any decision, is right for you is to get in touch with your feelings and listen to your heart.

BE TRUE TO YOURSELF

You’re true to yourself only when you follow your inner light, when you listen to what Ralph Waldo Emerson called the “still, small voice within.” You’re being the very best person you can be only when you have the courage and the fortitude to allow your definition of happiness, whatever it may be, to be the guiding light of every part of your life.

THERE ARE NO LIMITS

Accept the notion that you deserve all the happiness you can honestly attain through the application of your talents and abilities. The more you like and respect yourself, the more deserving you will feel of the good things in life. And the more deserving you feel, the more likely you will attain and hold on to the happiness you are working toward.

MAKE HAPPINESS YOUR KEY MEASURE

You should make happiness the organizing principle of your life. Compare every possible action and decision you make against your standard of happiness to see whether that action would make you happier or unhappier.

PAY THE PRICE

Of course, there are countless times when you will have to do little things that don’t make you happy along the way toward those larger things that make you very happy indeed. We call this paying the price of success in advance. You must pay your dues. Sometimes these interim steps don’t make you happy directly, but the happiness you achieve from attaining your goal will be so great that it totally overwhelms the temporary inconveniences and dissatisfactions of getting there.

QUOTES from the Masters…

 

On Gratitude:

 

“Sometimes our light goes out but is blown into flame by another human being. Each of us owes deepest thanks to those who have rekindled this light.” — Albert Schweitzer

“The more you recognize and express gratitude for the things you have, the more things you will have to express gratitude for.” — Zig Ziglar

“There is no better opportunity to receive more than to be thankful for what you already have. Thanksgiving opens the windows of opportunity for ideas to flow you way.” — Jim Rohn

 

On Habits:

 

“Being miserable is a habit; being happy is a habit; and the choice is yours.” — Tom Hopkins

“Good habits are hard to form and easy to live with. Bad habits are easy to form and hard to live with. Nothing is neutral. Everything counts.” — Brian Tracy

“Good habits are as addictive as bad habits, and a lot more rewarding.” — Harvey Mackay

“Nothing needs reforming so much as other people’s habits.” — Mark Twain