I have moved into the income phase of portfolio management, partially withdrawing each month from earned dividends *only* (leaving positions and principal untouched, except for ‘normal’ trading activity)!
In both of our individual brokerage accounts, I withdraw ~88% of the monthly dividends each month, or $175.00 from each account.
In my IRA account, I withdraw ~97% of the monthly dividends each month, or $775, with 33% of that amount ($255.75) withheld for federal taxes, leaving $519.25 for a net deposit. When I rollover my 401k in February these amounts will probably change again.
In my wife’s IRA account, I withdraw ~99% of the monthly dividends each month, or $875, with 33% of that amount ($288.75) withheld for federal taxes, leaving $586.25 for a net deposit.
In both of our IRA accounts, I just made a one-time withdrawal of the accrued dividends of $1500 from each account, with 33% of that amount ($495.00) withheld for federal taxes, leaving $1005.00 for a net deposit from each account. This is to help cover the expense incurred during the recent visit of our kids and grandkids. It was a great time, but we’re both still exhausted (and so is our checking account!). That’s also part of the reason why the monthly withdrawal amounts were increased, and I wanted to build up our checking account balance a little faster.
In my Roth IRA account, I withdraw ~94% of the monthly dividends each month, or about $125.
In my wife’s Roth IRA account, I withdraw ~97% of the monthly dividends each month, or about $300.
Any cash left in the accounts will be allowed to accrue for any upcoming stock purchases, etc., but I plan on keeping an amount equal to at least 1-2 months of withdrawals available in each account to cover any withdrawals for the next 1-2 months.
For both of our individual brokerage accounts, any amount in excess of the minimum required for 1-2 months of withdrawals will be transferred to my brokerage account via our joint brokerage account. These aggregated funds will allow me to make buys and pay only one trade fee instead of 2 for each buy, and the aggregation of our funds allows me to buy more. All purchases will be shared 50/50 into our individual brokerage accounts via our joint brokerage account. Any dividends or interest will be treated the same way.
This is not a permanent solution, however. I am only doing this until some of our monthly expenses are paid off, such as the furniture we bought when we moved here, my 401k loans, and any other monthly expense that might be eliminated or reduced. I should probably mention that all loans with the exception of my 401k loans are at 0% interest, because I don’t like to pay interest, I just like getting paid interest (i.e.; dividends!). My 401k loan re-payments are simply added to my 401k balance, although I do pay ~8% premium for the privilege.
This is the time-frame with the reduction amounts;