CI Review – Fidelity Minimum Required Distribution Workbook

by on Oct 24, 2012

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As we approach the end of the calendar year, some important decisions need to be made around the management of tax-deferred savings. One such decision involves the Minimum Required Distribution (MRD) for retirement assets. The IRS requires retirement plan participants and IRA owners to withdraw a minimum amount of assets from their qualified retirement savings every year once they reach age 70 1/2 or face penalties.

There are several rules behind these withdrawals regarding the age at which the investor can withdraw these assets as well as the amount that must be withdrawn. These rules could be confusing even for someone with investment savvy. With that in mind, we were pleased to receive a workbook by mail from Fidelity Investments meant to help their customers understand MRDs and to outline special services they offer to manage this process.

Fidelity MRD Workbook

Design and Layout
The workbook consists of 32 pages of high-quality paper, organized into four sections separated by labeled, numbered tabs. Among these four sections are essentially 14 lessons that effectively describe the key MRD considerations. These points are well-organized and follow a logical flow. The workbook uses a variety of font sizes and styles as well as colors and imagery, all of which are deployed effectively to organize content and enhance readability.

Fidelity MRD Workbook – Delaying your First MRD

Fidelity clearly articulates when to initiate an MRD as well as the service options available. There are 17 URL links referenced throughout that direct investors to areas of the Fidelity website where they can find additional information on specific issues.

The workbook cites two different calculation examples to help clients understand MRD timing and amounts. The first outlines the pros and cons for delaying your MRD. The other example covers the MRD calculation. This one struck us as odd since the illustration highlighted a portfolio valued at $59 million with deferred tax accounts totaling $11 Million – not an amount many people can relate to. Also, this example utilized incredibly small, difficult-to-read font.

Fidelity MRD Workbook – Track your MRD

Closing Thoughts
Fidelity’s MRD workbook is a helpful resource for clients, and is overall well-executed from a design and content standpoint. When creating a similar piece, keep in mind that illustrative examples can be an excellent learning tool. To help ensure understanding, these examples should reflect a common scenario, present data graphically and contain plain language that is easy to read.