Q. I have a small pension and Social Security. I also have to take Required Minimum distributions (RMDs). That altogether covers most of my expenses. plus I take out an extra 10k a year from my IRA. Should I take the IRA money all at once or monthly?
— Planning

A. There’s no one correct way to manage your cash flow in retirement.

It all depends on what makes you comfortable.

But at the same time, you want to make sure you don’t take out too little from your IRA so you’re not hit with costly penalties. You also don’t want to take out more than you need — outside of the requirements — so your money can grow tax-deferred as long as possible.

You can take out your annual distribution in a lump sum, and then leave it in a bank account for easy access, said Jerry Lynch, a certified financial planner with JFL Total Wealth Management in Boonton.

The key is making sure the money will be there when you need it.

“It’s not a big deal if you take it monthly or annually from a return standpoint because if you are planning on spending money in the next year, it should be conservative or in cash,” Lynch said. “The difference is if you don’t need it, you don’t have to pay taxes on it.”

Email your questions to ask@njmoneyhelp.com.

Karin Price Mueller writes the Bamboozled column for The Star-Ledger and she’s the founder of NJMoneyHelp.com. Click here to sign up for the NJMoneyHelp.com weekly e-newsletter. Like NJMoneyHelp.com on Facebook and follow it on Twitter

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