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Choicecut posted:My questions are, would it be wise to roll over the 403b into a traditional IRA? How would I go about doing this? If I do roll over, should I shift my contributions to max out the Roth and then contribute the rest into the traditional? Also, max your Roths before contributing to teh 403(b).
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Dec 14, 2011 17:12
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gvibes posted:My understanding is that you can't roll over the 403(b) until you leave the company. You can, 401ks you cannot.
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Dec 14, 2011 17:14
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After reading a bit of a thread I think the answer to this question is yes, but wanting to double check. I'm 32 and getting to the point where I am reasonably stable financially. I switched jobs a few months ago and my new employer does not match 401k. My last employer only started a match program a few months before I left, so I have around 2k in my old 401k. Should I drop my current 401k, and start my own roth? Should I also roll my old 401k into that? Both old/new employers use fidelity, so hoping I can piggyback on that to do all this. Thanks for the advice!
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Dec 15, 2011 21:33
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I would say Yes to both, unless you can afford to max out your Roth and want to put more into retirement savings on top of that. If so, then you'd use your 401(k) (even without matching) because at least it's still tax-advantaged.
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Dec 15, 2011 22:59
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The 401k is funded pre-tax. So to convert it into a Roth, you'll have to pay taxes on that $2000 before you convert it. So it would add some money on to your tax bill this year. You don't need to drop your 401k to start a Roth. They are seperate and you can have both. To convert to a Roth, you would first have to roll the 401k into a Traditional IRA (which you should do regardless) and then convert it to a Roth. You could also just leave it in a Traditional IRA and fund the Roth seperately. How much were you looking to contribute annually? That should be the first question before deciding what your options are.
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Dec 16, 2011 01:02
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I started a new job and am setting up my 401k contributions. The new job offers the option to contribute to a traditional and/or a Roth 401k. I've never had this option before so I have some questions that I'm trying to get my head around. I know the difference between the two in that a traditional is pretax and lowers your taxable income and a Roth is post tax. I'm 26 years old and really have no idea what my tax situation will be like when I retire (guessing on what my income will be and what the federal tax rates will be 35 years from now is above my knowledge) so I am thinking of splitting my contributions evenly into traditional and Roth. Questions: 1. Is the principle in a Roth 401k able to be withdrawn down the line without penalty like in a Roth IRA or are any withdrawals penalized before reaching 59 1/2 years old? I was talking to a representative on the phone with the company my 401k will be with and he was adamant that any of the money can be withdrawn penalty free after 5 years in a Roth 401k, even if I haven't met the age threshold yet. This seems false, but please correct me if he was correct. 2. Any money put into a Roth 401k will not count towards the yearly cap on Roth IRAs, correct? The 16500 limit on 401k and the 5000 limit on a Roth IRA are completely separate from what I understand. 3. Would I potentially be able to save a larger % of my income if I contribute to the Roth 401k since it is post tax?
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Dec 16, 2011 20:06
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Boola posted:1. Is the principle in a Roth 401k able to be withdrawn down the line without penalty like in a Roth IRA or are any withdrawals penalized before reaching 59 1/2 years old? I was talking to a representative on the phone with the company my 401k will be with and he was adamant that any of the money can be withdrawn penalty free after 5 years in a Roth 401k, even if I haven't met the age threshold yet. This seems false, but please correct me if he was correct. 1. Yes, Roth 401k behaves just like Roth IRA except you can contribute to it like a 401k 2. Yes. Roth 401k shares the 401k's contribution limit and not the IRA contribution limit. 3. Just like Roth, if you believe that your income(and therefor tax bracket) will be going up a Roth is a better choice to contribute into. Here is a IRS's pamphlet: http://www.irs.gov/pub/irs-pdf/p4530.pdf
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Dec 16, 2011 23:16
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Complicated IRA Questions: 1) I have $3000 in a traditional IRA account from 2008. I've been unemployed this whole year (2011) and I haven't collected any welfare or unemployment checks. Can I convert my traditional IRA into a Roth IRA at basically no cost, other than a small tax liability that is well under my income tax exemption? Afterwards, I should be able to withdraw my contributions from the Roth IRA because I really need the money without paying a 10% early withdrawal penalty. I also have a Roth IRA account opened in 2005 in Vanguard, I've read some vague stuff online that this may be relevant to my traditional IRA conversion. If the above works out fine, do I have to do it by 12/31/2011? Or can it wait until 4/15/2012 when I file taxes for the year? 2) Alternatively, I've spent ~$2000 on books and tuition at a local college that I will be attending starting January 2012. Are these expenses 'qualified educational expenses', even though they were paid in advance? Advice much appreciated. enigma74 fucked around with this message at 11:33 on Dec 17, 2011 |
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Dec 17, 2011 11:10
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80k posted:Book recommendation time... for somewhat more advanced reading, Expected Returns: An Investor's Guide to Harvesting Market Rewards by Antti Ilmanen is a phenomenal book. I'm not quite finished with it (it is long) but it could be the best book on investing I have read. In fact, I can't think of a more important book. Far too many people make rash assumptions on risk and expected performance, without being familiar with the academic literature.
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Dec 18, 2011 19:44
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gvibes posted:My understanding is that you can't roll over the 403(b) until you leave the company. You are correct. I was informed today that I would not be allowed to roll over my 403b unless I was leaving the hospital. Doesn't make any sense to me because it's non-employer matched. Anyway, I decided to cut contributions back to 50 dollars per pay to the 403b and max out our Roths. Gonna roll with that for awhile and see how it works and if things feel ok I will start bumping up the 403 contributions. Thanks for the advice.
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Dec 19, 2011 23:46
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moana posted:Just wanted to say that my mom got this for me as a Christmas present (today was Skype Christmas for us since we're not near each other) and I'm already loving it after the first chapter - it's definitely making me reconsider some of my ideas about investing. Thanks again for the recommendation! Thanks for the feedback on it, I was looking into picking this up too and looking for more feedback since it's really expensive.
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Dec 20, 2011 00:31
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Please excuse my incoming wall of text: My 401k plan doesn't have many choices. They only offers two index funds: Vanguard Small Cap Index NAESX (with a 0.31% expense ratio) and a large cap blend, Prudential Stock Index Fund Class Z PSIFX (with a 0.48% expense ratio). It would be great if I could just stick with index funds because I am a passive investor, but I feel like I should also be diversifying with bonds and international fund. The only bond fund available is PIMCO total Return Fund A PTTX (w/ a .85% expense ratio). As for international there are two choices, American Funds EuroPacific Growth Fund A AEPGX (with a 0.82% expense ratio) and New Perspective Fund A ANWPX (with a 0.79% expense ratio). Although the New Perspective fund has a lower expense ratio, it is a global fund and contains almost 40% US stocks- this may make my portfolio less diversified, since all my other assets are US funds. I am 25 years old, so I can take some risks. However, I would not feel comfortable throwing all my funds in the Vanguard's small cap index, even if it does have the lowest expense ratio. Goons, how would you go about diversifying this kind of 401k portfolio? How would high expense ratios effect your allocations? Would you just stick with the few index funds with the lower expense ratio?
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Dec 20, 2011 06:36
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Niwrad posted:Thanks for the feedback on it, I was looking into picking this up too and looking for more feedback since it's really expensive. Well, one warning I'd give is that it does not have the type of actionable advice or immediate relevancy to small investors that people have come to expect from the other recommended books on this forum (Bernstein, Swensen, Swedroe). That sounds bad but in fact, it is just the type of book that people interested in finance should read. It will give you a deeper understanding of post modern finance, making you far more rational and confident in your financial decisions. The knowledge and insight will give you the perspective you need during challenging times. I am thrilled that this book exists. It is more readable than most textbooks but less so than your average retail investing book. But there is a very clear difference here. Your average retail book is written for an audience that has been misguided by the financial media for their entire lives. The author has to guide you on the right track with some actionable advice with the understanding that any push in the right direction is better than none at all. By design, these books will not provide a solid financial foundation in your head. If you read Bernstein's Efficient-Frontier articles, you will know that his investing views and vast knowledge are only hinted upon in his books. The same goes with Larry Swedroe if you have a chance to correspond with him privately or see his public interactions on investing boards... compare that to the voice he uses for his retail books. Ilmanen's book is the best "next step" I have seen for intermediate-to-advanced financial folks or anyone with patience and a desire to learn... one that provides a very complete and even-handed overview of post-modern-finance... a book that simultaneously supports passive index investing as well as being an invaluable guide for active investors. As you can imagine, I think the $47 (or whatever it costs today) is a small price to pay. Also, you're welcome Moana. Glad to hear you are enjoying the book.
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Dec 20, 2011 23:39
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Should have my copy in the next few days 
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Dec 21, 2011 05:01
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Lyon posted:I think maxing (or as close to it as you can) your Roth might be equal to or better than student loans because Roth is use it or lose it. But student loans compound every year, too. You similarly can't pay off loans years later and retroactively get those years of compound interest debited back to you. It makes the most sense to do what will provide the greatest returns, and unless you have loans out at 3-4% or less, you should pay them off first. Loans are guaranteed to cost that much in interest, unlike the market, where you're not necessarily going to see better returns in any given year (especially in the current economy).
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Dec 21, 2011 13:56
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I'm 25 and beginning my retirement savings. I'll be putting in 8% per year for company match and would like to invest very aggressively. I thought it would be wise for me to consult a higher power for advise (this thread). I have about 18 investment options to choose from and would like to select 2-6 of them to invest in. Hopefully someone is more familiar with these funds than I am. Long list of investments incoming! Mutual funds are listed with their Total Expense ratio. Vanguard LifeStrategy Growth 1.25 Vanguard LifeStrategy Mod Gro 1.24 Vanguard LifeStrategy Cons Gro 1.24 Advantus Money Market 1.22 Vanguard Interm Bond Idx Sig 1.16 Ivy Real Estate Sec Fund CI Y 1.96 Advantus S&P 500/Citigroup Val 1.18 Invesco Van Kampen Comstock, A 1.54 Advantus S&P 500 Index 1.12 Victory Inst'l Diversified Stk 1.61 Advantus S&P 500/Citigroup Gro 1.18 Turner Large Cap Growth 1.51 Columbia Mid Cap Value Opp, Z 1.81 Disciplined Gro Mid Cap Gro 1.67 Wells Fargo Adv Intrin SCV, I 1.95 DFA U.S. Small Cap Portfolio 1.42 Alger Small Cap Growth, I-2 1.90 GMO Intl Core Equity, CI III 1.40 Which ones are the winners? FlyWhiteBoy fucked around with this message at 00:05 on Dec 26, 2011 |
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Dec 25, 2011 18:15
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FlyWhiteBoy posted:Which ones are the winners?
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Dec 25, 2011 21:32
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moana posted:The ones with low expense ratios that will allow you to meet your asset allocation goals. Post those and then we can help. I've edited my post to include the Total Expense. I hope this is the information we need?
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Dec 26, 2011 00:06
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FlyWhiteBoy posted:I've edited my post to include the Total Expense. I hope this is the information we need? You need to figure out what you want as a allocation goal. The two most important decisions are the split between stocks and bonds and the split between US stock and international stock. Let's suppose you want an 80/20 stock/bond split, and a 40/60 US/world stock split. This is reasonable for someone your age, but you need to decide for yourself what kind of allocation you want. You could fill up the domestic stock and bonds in an 80/20 ratio just by using: Advantus S&P 500 Index 1.12 Vanguard Interm Bond Idx Sig 1.16 And invest your Roth IRA entirely in an ex-US stock fund to diversify internationally. For someone just starting out, don't worry about getting fancy with a bunch of different funds, just start saving. You should pick up a copy of The Four Pillars of Investment and The Intelligent Asset Allocator and get yourself learning and THEN decide if you want to change your allocation. It'll take a bit of study, but once you know why you're putting your money where it needs to go, you'll be better off weathering variance in the long run. Still, with a company match, you should start saving yesterday to pick up that free money. Hope this helps. There isn't one right answer, and so you should do some research to find out what kind of investments are right for your personal goals.
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Dec 26, 2011 07:57
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Quick dumb questions before I dive into this thread: If I open a Vanguard Roth IRA and begin investing in their target retirement 2055 fund and I become more educated later I can move that principal to other funds whenever I want right? And are there fees for moving money between funds? Vanguard still have the lowest fees?
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Dec 28, 2011 03:30
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Orange_Lazarus posted:Quick dumb questions before I dive into this thread: 1) You can move the total amount to anything you want, with a few stipulations. A: If you take it out of the Roth IRA, you will pay penalties. B: If you want to use another companys funds (IE your Roth IRA is with Vanguard and in Vanguard funds and you want to move it to a Fidelity fund) you will have to pay additional fees or roll over the account. 2) There are no fees for moving between Vanguard funds when using Vanguard as your company. 3) Yes, sans the TSP which you may or may not be eligible for/want to use. Question of my own: What's the minimum amount where annually rebalancing a portfolio is necessary and relevant? xaarman fucked around with this message at 02:11 on Dec 29, 2011 |
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Dec 28, 2011 05:42
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xaarman posted:1) You can move the total amount to anything you want, with a few stipulations. A: If you take it out of the Roth IRA, you will pay penalties. B: If you want to use another companys funds (IE your Roth IRA is with Vanguard and in Vanguard funds and you want to move it to a Fidelity fund) you will have to pay additional fees or roll over the account. We use 5% bands and a minimum of $3000 in transaction size for rebalancing. Anything smaller in $ is too expensive in commissions and the 5% let's the positions run a little.
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Dec 29, 2011 00:19
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I'm currently a student in a professional program (medical field) and I have a very good lead on a job right now. A doctor at the school at which I'm studying just signed a contract with a small holding company to open up a clinic in the city in which I'd love to settle. He seems very serious about hiring me when I graduate (August) and he set up a meeting for me with the CFO of the holding company several weeks ago that went very well. It looks like I have a good chance of getting a job offer within the next month or two. This brings me to my question. If I'm made an offer, what do I need to know/what do I need to ask about salary and benefits, especially regarding retirement benefits? In our first meeting, the CFO asked whether I knew what the starting salary for a new graduate should be. I had read and reread the very thorough annual salary survey that is published by my professional organization and was able to quote him the median salary for employees that match my experience/certification. He said I really knew my stats and at some later point he mentioned I would be fairly compensated (the "if made an offer" was implied), and that was the extent of our discussion of compensation. What kinds of questions should I ask about retirement benefits? I am hoping for 401k matching with good investment options, but I doubt whatever plan they have would be a negotiable element of an offer. I assume that if the benefits are subpar that I should negotiate for a higher salary to compensate, but how can I know what to do? I've never had a salaried job before so I'd really like to know what to expect if I meet with the CFO again and he makes me an offer. Any advice/steering to another resource would be greatly appreciated. I just read The Four Pillars of Investing which I thought was great. Are there any books that would be more geared to my current situation? Uranium 235 fucked around with this message at 05:44 on Dec 29, 2011 |
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Dec 29, 2011 05:37
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I completely missed this, but what are you guys doing in response to SmartyPig's drop to 0.7% a few weeks ago? Not really sure if I should keep my money in there or take it out and move it somewhere else. Edit: Sorry wrong thread
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Dec 30, 2011 15:35
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Heh. Don't credit unions have better rates than that?
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Dec 30, 2011 17:33
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The limit on an IRA is ~$5000 a year, right? If I'm married and one of us is a stay at home parent, can the other invest another $5000 into an IRA for them on their behalf, or is it one IRA per couple?
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Dec 30, 2011 20:48
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mobn posted:The limit on an IRA is ~$5000 a year, right? If I'm married and one of us is a stay at home parent, can the other invest another $5000 into an IRA for them on their behalf, or is it one IRA per couple? It's an IRA per person, so you can contribute $10,000 total. Based on http://www.irs.gov/publications/p590/ch01.html#en_US_2011_publink1000230412 you can both have one up to $5,000 even if one isn't working, assuming you file jointly.
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Dec 30, 2011 21:00
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Can anyone inform me about this Shadowstats website that claims the real inflation rate is absurdly high? On some other forums, I see their graphs thrown around like they are stone cold fact, and people don't even question it. I don't know that much about economics so I lack the background to debunk this myself, so I thought I'd ask in here to get a better feel for it. My instincts tell me this is wrong because I haven't seen prices change drastically enough for me to believe that inflation is 10% and has been for years.
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Jan 2, 2012 02:44
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Uranium 235 posted:Can anyone inform me about this Shadowstats website that claims the real inflation rate is absurdly high? On some other forums, I see their graphs thrown around like they are stone cold fact, and people don't even question it. I don't know that much about economics so I lack the background to debunk this myself, so I thought I'd ask in here to get a better feel for it. My instincts tell me this is wrong because I haven't seen prices change drastically enough for me to believe that inflation is 10% and has been for years. I said this in the debate and discussion thread, but it might go over better here. The shadowstats figures overstate things by several percentage points a year, and the effect is particularly pronounced over long periods. David Clayton, blogger posted:BLS says inflation over the last 20 years has been 73%. ShadowStats claims prices have increased 379%. John Williams apparently believes the price level is almost 5 times higher today than in 1990.
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Jan 2, 2012 04:09
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Hobologist posted:I said this in the debate and discussion thread, but it might go over better here. The shadowstats figures overstate things by several percentage points a year, and the effect is particularly pronounced over long periods.
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Jan 2, 2012 05:35
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I'm currently maxing out both my yearly Roth IRA contribution and my matched 401k contribution. I'm considering contributing more to my 401k, but I'm leery of this because I'd ideally like to be storing money in an accessible place for either purchasing a house or taking time off to travel. Is that concern founded? If so, what's a good low-to-moderate-risk investment? I'm guessing I should probably just mirror my retirement investments (with perhaps a tweaked blend) in a taxable account, but I first wanted to check and see if y'all had any experience with this situation. At the moment, my savings are in a high-yield savings account.
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Jan 2, 2012 21:02
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Happy New Year! Can you guys help me pick some ETFs for my Roth IRA? I already have a 401k invested in some diverse mutual funds (my coworker helped me pick these out), so I'm trying to be a bit more adventurous with the Roth IRA. I want something with very little maintenance and moderate risk. I'm looking to retire around 2040-2045, if that helps. Last year, I tried to research and invest on my own... and I think I failed miserably. My $5,000 quickly dropped to about $3,500, and is now relatively stable at $4,300. Here's what I chose: Do you guys have any advice on what I should do with this year's $5,000? Should I pump more into last year's choices, or pick something entirely different? If so, any pointers?
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Jan 2, 2012 23:40
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Does your 401k offer target retirement funds? I think those are the best if you don't have a lot of money in the account right now. There are others who could comment far better on the allocation and specific funds. But I wouldn't be too concerned with a drop. I'm fairly certain it was a down year so most people lost money on their retirement investments. This is a 30+ year investment though so the returns from one year should be inconsequential.
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Jan 3, 2012 04:31
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Yep, the 401k has a hefty allocation towards a target fund (2040 I think) so like I said, I'm willing to be a bit more experimental with the Roth and ETFs. I just want advice that says I'm going in the right or wrong direction with my choices.
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Jan 3, 2012 04:59
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coco bryce posted:I'm currently maxing out both my yearly Roth IRA contribution and my matched 401k contribution. I'm considering contributing more to my 401k, but I'm leery of this because I'd ideally like to be storing money in an accessible place for either purchasing a house or taking time off to travel. Is that concern founded? If so, what's a good low-to-moderate-risk investment? I'm guessing I should probably just mirror my retirement investments (with perhaps a tweaked blend) in a taxable account, but I first wanted to check and see if y'all had any experience with this situation. At the moment, my savings are in a high-yield savings account. I think your concern is founded. In fact, I currently am going through the same thing. I can put more money away for retirement but don't want to sidetrack any future plans to buy a house or something. What I did was sort of create a plan that someone on a fixed income would use. Much less risk than my retirement plan but still capable of pulling in something in return. It's a mix of TIPS, GNMA, and a bond index fund. I keep a a high-yield savings account as an emergency fund, but this is sort of my "might need later so can't really look too far down the road" allocation. In any event, I'd love to hear others answer on this as it's been a problem I've faced as well.
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Jan 3, 2012 05:59
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Niwrad posted:I'm fairly certain it was a down year so most people lost money on their retirement investments. The Dow was up by inflation more or less, and the S&P500 was almost dead flat. I think NASDAQ was down some. Without sitting down and running the numbers, I think he's down a couple hundred bucks vs the market as a whole. Syphon, maybe buying into SPY would be a good addition? Considering your VXF holdings, it seems like a conspicuous absence to me. It's not particularly adventurous, but it is low-maintenance and pretty much defines "moderate risk".
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Jan 3, 2012 11:05
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syphon posted:Yep, the 401k has a hefty allocation towards a target fund (2040 I think) so like I said, I'm willing to be a bit more experimental with the Roth and ETFs. I just want advice that says I'm going in the right or wrong direction with my choices. Get your adventure from something other than your retirement savings. You want that money to be boring, that is how you succeed in the 30+ year horizon game. If you want excitement, buy a jetski or gently caress a stranger without a condom. Don't do it in your retirement accounts.
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Jan 3, 2012 12:44
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Yond Cassius posted:Syphon, maybe buying into SPY would be a good addition? Considering your VXF holdings, it seems like a conspicuous absence to me. It's not particularly adventurous, but it is low-maintenance and pretty much defines "moderate risk".
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Jan 3, 2012 19:56
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Has anyone taken the plunge and contributed the full 2012 amount to their ROTH yet?
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Jan 4, 2012 16:15
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bam thwok posted:Has anyone taken the plunge and contributed the full 2012 amount to their ROTH yet? Yes, why?
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Jan 4, 2012 16:44
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