Each year, funds are collected from your accounts to fund your retirement expenses. The first portion of these funds comes from pensions and other incomes. Next come funds from required IRA distributions. If this is not enough to cover your retirement expenses, your other available accounts are tapped for additional funds to make up the shortfall.
Withdrawals are instructions to remove funds annually from an account and add them to the collection of funds for your retirement expenses. Withdrawal instructions let you specify an account to be used to fund retirement expenses before the shortfall procedures operate to tap other accounts.
Withdrawn funds are added to the funds collected from required IRA distributions and pensions or other incomes. If too much is withdrawn and a surplus is collected, the surplus is transferred to the account you specified in the parameters data entry window to receive surplus funds.
If you want to retain the account's capital, you can specify that the withdrawals are to be the earned income only, instead of specifying a fixed amount.
You can specify multiple withdrawal instructions to handle varied situations concerning the same account.
To handle penalty-free SEPP distributions from IRAs, a check box is available on "withdrawal" instructions and "transfer" instructions that are from IRA accounts. This gives you an option to define each specific distribution as one without penalty tax. In that way you can define your planned early distributions and have them done without a penalty tax calculation by the program. You have to specify each individual distribution and mark it as exempt from penalty tax. The Forecaster program does not verify the correctness of your specifications.
Enter the withdrawal amount or indicate income only. Enter the year that the withdrawals start and the length of time the withdrawals continue. A one-shot withdrawal has a period of 1 year.
An instruction for a withdrawal amount can be indexed to keep pace with inflation.