Thanks for your valuable recent “Best of the Net” article. Please may I put in an independent plug for the Optimal Retirement Planner (www.i-orp.com)? (I have no conflict of interest). This is an excellent site with an optimizing program for withdrawing retirement savings from different sources, and it is free. Due to progressive tax rates and the compulsory liquidation of IRA contents over time, the issue of how to optimally withdraw retirement savings is more complicated than many realize. The use of simultaneous partial withdrawal should be considered.
Andrew from Seattle
I would like to add two excellent websites to your “Best of the Net”: MLP Profits (www.mlpprofits.com) and QuantumOnline.com (quantumonline.com). I find the first a big help in my evaluation of master limited partnerships and the second gives me suggestions for funds, etc.
B. William Dunn
While I enjoy reading your “Best of the Net” article each year, I am always left wondering why AOL Finance never seems to make it into the publication. In addition to the comprehensive nature of this service, it seems to be the only one that provides totals across portfolios. It is also quite flexible and easy to work with. In a similar vein, why doesn’t Morningstar.com appear in the Comprehensive category? I find it a very comprehensive site offering many more options than what is available in your selections.
Steve from Connecticut
The Editors Respond:
AOL Money and Finance is now known as DailyFinance (www.dailyfinance.com) and it has an increased a focus on providing financial news articles. Although this is a strength for DailyFinance, it means that the site no longer provides the financial data we seek in our top comprehensive sites.
Morningstar.com does not provide the comprehensive news that we believe should be expected from a top comprehensive site. It is included in several areas of the guide where it truly excels.
The First Cut article on cash flow kings with rising dividends was helpful. Although the writer disclosed why financial stocks were not listed, he did not mention why utilities were not on the screen.
John Bajkowski Responds:
We only excluded stocks in the financial industry and real estate investment trusts . We did not exclude utilities; they simply did not pass the criteria. The full set of criteria behind the screen can be viewed on our website at www.aaii.com/journal/article/cash-flow-kings-with-rising-dividends.
To clarify the IRA distribution statement, must your 70th birthday occur prior to June 30, 2010, in order to be required to take a minimum distribution in 2010?
Also, when calculating the distribution amount (which is based upon remaining life expectancy), when is the basis for total value calculated? For instance, if one took the minimum distribution on January 1, 2011, based upon the market value of the total tax-deferred accounts on January 1, 2011, and sometime later during the year the total value of the original tax-deferred accounts declined, could one return the difference between the value taken on day 1 and the amount that would have been taken on the declined value date and still meet the requirements of the minimum distribution calculation?
Robert from New York
The Editor Responds:
The IRS states that a “retirement plan account owner must withdraw annually starting with the year that he or she reaches 70½ years of age or, if later, the year in which he or she retires. However, if the retirement plan account is an IRA or the account owner is a 5% owner of the business sponsoring the retirement plan, the RMDs [required minimum distributions] must begin once the account holder is age 70½, regardless of whether he or she is retired.”
Regarding the balance upon which the required minimum distribution is based, the IRS explains, “Generally, an RMD is calculated for each account by dividing the prior December 31st balance of that IRA or retirement plan account by a life expectancy factor that IRS publishes in Tables in Publication 590, Individual Retirement Arrangements.”
For more information, see the IRS Web page Retirement Plans FAQs regarding Required Minimum Distributions at www.irs.gov/retirement/article/0,,id=96989,00.html.