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Re: How much TIAA Traditional?

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@Learner wrote:

@TheWizard ,

I suppose you have had your Roth IRA account longer than five years.  Does each monthly converted amount have its own separate five-year rule?  Even if the answer is yes, you should be able to withdraw the converted amount (but not any earnings) anytime you wish with no problem?  Am I correct?


It is my understanding that after one has contributed to ANY Roth 5 years ago and is over 59 1/2, this Roth and any new Roth's created from any old Roth by roll overs are accessible tax-free and that any IRA -> Roth conversions to existing or new Roth's are also tax-free. Does this sound like the correct interpretation for Roth tax-free accessibility?

 

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Re: How much TIAA Traditional?

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@Learner wrote:

@TheWizard ,

I suppose you have had your Roth IRA account longer than five years.  Does each monthly converted amount have its own separate five-year rule?  Even if the answer is yes, you should be able to withdraw the converted amount (but not any earnings) anytime you wish with no problem?  Am I correct?


Not quite correct. My first Roth IRA was over a decade ago and I'm (well) over age 59-1/2, so neither of the two five year rules apply to me at this point.

Anyhow, I'm not sure I even have a plan for withdrawing $$$ from my Roth. I'll need around $40k for a new Mustang in a couple years, so do I take that from my Roth IRA or from my (smallish) taxable account?

I should think about it...

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Re: How much TIAA Traditional?

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@judger, I am making a distinction between converted amount and its earnings.  Qualified withdrawals are tax-free, yes.

@TheWizard, I know the 59 1/2 and five-year rules.  I was wondering whether any new converted amount has its separate five-year rule regarding its earnings.

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Re: How much TIAA Traditional?

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@judger wrote:

@Learner wrote:

@TheWizard ,

I suppose you have had your Roth IRA account longer than five years.  Does each monthly converted amount have its own separate five-year rule?  Even if the answer is yes, you should be able to withdraw the converted amount (but not any earnings) anytime you wish with no problem?  Am I correct?


It is my understanding that after one has contributed to ANY Roth 5 years ago and is over 59 1/2, this Roth and any new Roth's created from any old Roth by roll overs are accessible tax-free and that any IRA -> Roth conversions to existing or new Roth's are also tax-free. Does this sound like the correct interpretation for Roth tax-free accessibility?

 


It does indeed.

Kitces has a write-up on this from a few years ago that explains things clearly for those who want clarification...

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Re: How much TIAA Traditional?

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Dede

Even my converted amounts is more than a decade old. The rule is five years since you opened the account. I opened our ROTH back in 1998 with TIAA. The rules are slightly changed in the new tax return. But, I can still use those rules because my final conversion was in 2014. Vanguard gives the code "Q" for me and "T" for my wife. The resason is that I opened my wife's ROTH account a year later and transfereed her assets a year later. Indeed, we never could invest in her account since 2009 because we never had earned income since then and it is all old money. Vanguard will start using the letter "Q" from this taxable year for both.

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Re: How much TIAA Traditional?

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Re: How much TIAA Traditional?

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@ECEPROF wrote:

Vanguard gives the code "Q" for me and "T" for my wife.

-----------------------

ECEPROF: Question--where are these codes located? On your Roth statements?  --Aquinas

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Re: How much TIAA Traditional?

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Re: How much TIAA Traditional?

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@Aquinas wrote:

@ECEPROF wrote:

Vanguard gives the code "Q" for me and "T" for my wife.

-----------------------

ECEPROF: Question--where are these codes located? On your Roth statements?  --Aquinas


In 1099-R form, Box 7 contains the code. By the way, I have withdrawn a few times when I had ROTH account with TIAA also - even large amounts. TIAA was giving Q first. Since I moved most of the cash to Vanguard, even though TIAA knows that I had started in 1998 and yet, it gave me "T"  once. Then, Skipper and AL (he does not participate here now) gave me the idea how to choose and tick the part that it was more than 5 or 10 years - something like that. I did that, and then it becomes untaxable.

View solution in original post

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Re: How much TIAA Traditional?

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When I retired I had between about 30%  of my TIAA holdings in TIAA Traditional. About ten years after retirement I moved about 50% of my TIAA holdings (all of CREF holdings) to an external IRA. Now after nine more years my TIAA Traditional holdings are down to less than 6% of total holdings and about 50% of my TIAA holdings. In November 2021 I will be completely out of TIAA Traditional. I never annuitized any of the TIAA Traditional holdings. As you say it is a personal decision so I won't talk about why I did it that way. The only decision that I maybe regret is that at about the time of the dot.com bubble I had too much in CREF Growth, I over reacted and went to TIAA Traditional for a few years. I certainly don't regret getting out.

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Re: How much TIAA Traditional?

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It looks like I have about 40% in TIAA traditional.

Some of it I will annuities. Some not. Some I already did.

For now it is hard to argue against 3% guaranteed tax deferred. Most of my TIAA traditional is now flexible. I'm slowly rolling it into Roth. Then it will be 3% tax free!

It is hard to beat 3% tax free growth, unless you want to take risks. I'm guessing that long term 3% will not be enough, so I have to take risks ;)

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Re: How much TIAA Traditional?

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I had about 75% of my TIAA investments in the TIAA traditional, the rest in CREF stock and TIAA RE.  Of the 75% in TIAA traditional, about 75% of that was in a TIAA after tax annuity. I annuitized all of my TIAA annuity, and now am left with only CREF stock and TIAA RE, which I won't touch.

My history is teaching in international schools in some 10 countries, and a few of these schools had TIAA as their retirement program which I participated in. However, the last 20 years or so, the schools did not have TIAA, and so I continue to send in money on my own to an after tax annuity.

It's nice having a "pension" and not being too concerned about the rest of my investments in TIAA.

Rob

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Re: How much TIAA Traditional?

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@dknightd wrote:

It looks like I have about 40% in TIAA traditional.

Some of it I will annuities. Some not. Some I already did.

For now it is hard to argue against 3% guaranteed tax deferred. Most of my TIAA traditional is now flexible. I'm slowly rolling it into Roth. Then it will be 3% tax free!

It is hard to beat 3% tax free growth, unless you want to take risks. I'm guessing that long term 3% will not be enough, so I have to take risks ;)


I'm assuming you have a Roth 403(b) option in your employer's plan, into which you are moving TIAA Traditional. It should indeed retain the 3% minimum that way.

If you had opened a Roth IRA at TIAA, like I did, then Trad moved into there would have a much lower guaranteed minimum, 1% I believe...

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Re: How much TIAA Traditional?

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@TheWizard wrote:


I'm assuming you have a Roth 403(b) option in your employer's plan, into which you are moving TIAA Traditional. It should indeed retain the 3% minimum that way.

If you had opened a Roth IRA at TIAA, like I did, then Trad moved into there would have a much lower guaranteed minimum, 1% I believe...


Correct. I have Roth 403 and Roth IRA. I Use Traditional only in 403. Too bad Roth 403 is subject to RMD. But that is a few years away for me.

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Re: How much TIAA Traditional?

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@dknightd wrote:

@TheWizard wrote:


I'm assuming you have a Roth 403(b) option in your employer's plan, into which you are moving TIAA Traditional. It should indeed retain the 3% minimum that way.

If you had opened a Roth IRA at TIAA, like I did, then Trad moved into there would have a much lower guaranteed minimum, 1% I believe...


Correct. I have Roth 403 and Roth IRA. I Use Traditional only in 403. Too bad Roth 403 is subject to RMD. But that is a few years away for me.


Yes, but that is easily fixed by rolling over Roth 403b into Roth IRA. It is just a quirk of complex retirement legislation.

YBB
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Re: How much TIAA Traditional?

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My wife and I have 34% of our retirement funds in TIAA traditional. I have already annuitized my Traditional funds. My wife will also in the next year.

 

Nate

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