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Vanguard Wellesley Income Inv Message Board

  • verenagrossi verenagrossi Apr 3, 2012 8:57 AM Flag


    If I have this fund in my retirement account , is there a better time to take payments each year ? For ex , if I need $30000 each year from the fund , does it make any difference if I wait until late Dec and take a lump sum , or better to take out several installments ? Not concerned about taxes , since it will be ordinary income , more about fund's value

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    • I'd take out money every January. The market is usually up then, because most companies pump up their year end reports. Also, you could collect the Q4 dividends and defer some taxes to the following tax year. I'd avoid Q2 or Q3 because the market is down then. December would be my 2nd choice if I didn't care about taxes.

    • verena, dollar cost averaging IN/OUT is probably the best strategy. It has been the recommended strategy for years and years for good reason.

    • Probably, the answer is that it depends on what the fund does over the year. For example, in 2008 you would have been better off taking it over the course of the year because the fund was at the year's lowest levels in December. In 2009, you may have been better waiting until December because the fund was at its highest levels for the year in December.

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