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Roumba posted:HR gave me a different mealy-mouthed BS sounding response when I asked for better 401(k) funds/features for the zillionth time. Something about they don't want to worry about being a top-heavy benifts plan or words to that effect. HR probably doesn’t want to look at it because that’s a lot of work to switch providers. How much, no idea, but a lot of work as in “more than the 0 work to keep the status quo.” Unless you can convince the owner or CEO, my cynical answer is I don’t see why they would look at it.
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Sep 1, 2021 15:07
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Roumba posted:HR gave me a different mealy-mouthed BS sounding response when I asked for better 401(k) funds/features for the zillionth time. Something about they don't want to worry about being a top-heavy benifts plan or words to that effect. The nondiscrimination test methodologies are highly transparent and governed by the IRS, but the counts of employees and balances falling in to each bucket are not. I didn't find any information on our nondiscrimination test results in our plan information. However, the choice of funds shouldn't really affect nondiscrimination tests directly. I suppose they may think that if better funds are on offer that HCEs will defer more and you'll fail the ADP test but I think you are right that they are just being lazy.
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Sep 1, 2021 15:38
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H110Hawk posted:Set it all to 100%. Seriously. Espp. 401k. Whatever you have. You'll get some $0 paychecks but so what? I was already maxing my ESPP thanks to an agreement with the SEC letting us sell a % at the initial offering period, which was pretty sweet. The HR people who are in the upper echelons seem to get it wrt retirement and equity options so we usually get a lot of good breaks. So I've been partially living off my post-tax savings since this spring. Just put in to get the additional dollar contribution amount to get to the 401k max this year and don't need much savings to do it. And they're starting to match up to 4% of salary next year. cheese eats mouse fucked around with this message at 16:47 on Sep 1, 2021 |
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Sep 1, 2021 16:32
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Wife got a new job that has a Simple IRA which we've never had before. The paperwork she was provided by HR to set it up basically just asks for her account info. From reading it's my understanding that Simple IRAs are essentially self managed, but I can't for the life of me figure out how to actually open an account anywhere. When I check with Vanguard or Fidelity everything is written for the business to set one up. Am I correct in that we should be able to open such an account on our own to then provide the info to her employer, or does she need to push to get more info from them?
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Sep 1, 2021 17:21
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Loan Dusty Road posted:Wife got a new job that has a Simple IRA which we've never had before. The paperwork she was provided by HR to set it up basically just asks for her account info. From reading it's my understanding that Simple IRAs are essentially self managed, but I can't for the life of me figure out how to actually open an account anywhere. When I check with Vanguard or Fidelity everything is written for the business to set one up. Am I correct in that we should be able to open such an account on our own to then provide the info to her employer, or does she need to push to get more info from them? Her employer should be providing her with a form to fill out. They have mandatory matching elements. At least that's how it worked for sample size of 1 for us. Fidelity had a bog standard form she filled out including things like writing who she worked for on top. Like going here and clicking the "Enroll Employees" part: https://www.fidelity.com/retirement-ira/small-business/simple-ira/getting-started (But note, the SIMPLE IRA was already adopted by the company.) cheese eats mouse posted:I was already maxing my ESPP thanks to an agreement with the SEC letting us sell a % at the initial offering period, which was pretty sweet. The HR people who are in the upper echelons seem to get it wrt retirement and equity options so we usually get a lot of good breaks. So I've been partially living off my post-tax savings since this spring. 
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Sep 1, 2021 17:39
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H110Hawk posted:Her employer should be providing her with a form to fill out. They have mandatory matching elements. At least that's how it worked for sample size of 1 for us. Fidelity had a bog standard form she filled out including things like writing who she worked for on top. Like going here and clicking the "Enroll Employees" part: https://www.fidelity.com/retirement-ira/small-business/simple-ira/getting-started (But note, the SIMPLE IRA was already adopted by the company.) So they gave her a form 5304-Simple which was completed with the employer info but has a section for her to fill out 'Employee Selection of Financial Institution' where it asks for institution name address and account number. It seems she needs to create an account first. Just having trouble figuring out how to actually create an account first. When asking HR about it, they said to reach out to the institution on getting an account created. I may just need to call but figured I'd be able to find this info easily online but I haven't yet.
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Sep 1, 2021 21:23
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Loan Dusty Road posted:So they gave her a form 5304-Simple which was completed with the employer info but has a section for her to fill out 'Employee Selection of Financial Institution' where it asks for institution name address and account number. It seems she needs to create an account first. Just having trouble figuring out how to actually create an account first. When asking HR about it, they said to reach out to the institution on getting an account created. I may just need to call but figured I'd be able to find this info easily online but I haven't yet. Like they gave her this? https://www.irs.gov/pub/irs-pdf/f5304sim.pdf That seems wrong. Maybe ask the HR rep "Neat, where do you have your account? Is it Fidelity?" (or coworkers.) That might short circuit the weirdness, include some actual brokerage name there - you want them to be prompted to correct you.
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Sep 1, 2021 21:31
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Duckman2008 posted:I think this got missed, so to reply to it with my two cents. Thanks for the response, definitely some good food for thought.
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Sep 2, 2021 21:53
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I'm starting a new job, and it's time to roll over from my employer's Principal 401k to my rollover IRA in Vanguard. It's been a while since I did a rollover, and I recall it being a huge pain in the rear end - they had to send me a check, I had to ensure it had the right info on it, then I had to endorse it and mail it to Vanguard. It sucked. Is there an easier way to do this now? Should I be asking for some other service to do it for me?
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Sep 7, 2021 15:33
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Vanguard can possibly do it all for you if you give them the information for your other account, I know they're able to for some institutions.
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Sep 7, 2021 15:37
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I just remembered that I originally hosed up and have about 1.3k in Roth 401k, and Vanguard's telling me "oh you need like 3k to start a Roth IRA" or something. I hope they realize that they'll be rolling into an existing Roth IRA.
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Sep 7, 2021 15:52
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Vanguard's mobile app lets you take a picture of the physical check for a rollover. So you only have to deal with the anxiety of the one leg of the postal service.
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Sep 7, 2021 15:59
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First of all thank you so much to everyone in this thread. Learning a great deal. I have a "Rollover IRA" account at Charles Schwab where I had rolled over a previous jobs 401k, but never really touched it from there aside from my yearly IRA max contribution. From my completely amateur take it looks like a Rollover IRA is just considered a Traditional IRA for tax purposes? I'm not sure if it was mentioned in here, but I realized I had the option to convert it to a Roth IRA and started reading about that. What is the general opinion on converting? It seems like I'm going to take a rather large tax hit in doing so based on the results from the Schwab IRA conversion calculator. Am I better off leaving that IRA as-is and just starting a separate Roth (I think it's possible to have 1 of each right)? I assume if I don't want to convert that I'd at least want to begin contributing to a new Roth IRA account because it would give me better withdrawal options at retirement time?
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Sep 7, 2021 16:40
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Pollyanna posted:I'm starting a new job, and it's time to roll over from my employer's Principal 401k to my rollover IRA in Vanguard. It's been a while since I did a rollover, and I recall it being a huge pain in the rear end - they had to send me a check, I had to ensure it had the right info on it, then I had to endorse it and mail it to Vanguard. It sucked. when i rolled over my principal 401k to vanguard they were able to cut the check and mail it directly to vanguard. i just gave them the info on how to make out the check and where to send it, so less of a pain in the rear end than some administrators who force you to touch the check
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Sep 7, 2021 17:02
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GhostofJohnMuir posted:when i rolled over my principal 401k to vanguard they were able to cut the check and mail it directly to vanguard. i just gave them the info on how to make out the check and where to send it, so less of a pain in the rear end than some administrators who force you to touch the check Yup, some of them sure will. Like Fidelity.
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Sep 7, 2021 17:08
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Tev posted:First of all thank you so much to everyone in this thread. Learning a great deal. Yeah, a Roth conversion is taxed as income. There are two main reasons to convert: 1. If, in a given year, you have very little income, you can convert IRA funds for free until your income reaches the edge of the 0% tax bracket. It's a nice trick if you're out of work for a while or have just recently retired. 2. If you're above the income limit for contributing to a Roth IRA normally but still want to do so, you need to do what's known as a backdoor Roth, which practically requires you to have no money in Traditional/Rollover IRAs. But, if you have a current 401k, you could avoid conversion and the tax hit by just rolling the Rollover IRA into that instead. If you're not in either of those situations, you're perfectly fine leaving the IRA as-is and contributing to a new Roth IRA. And yes, even if you're within the income limits to deduct Traditional IRA contributions from your taxes, it's generally better (due to being in a relatively low tax bracket) to contribute after-tax money to a Roth IRA instead.
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Sep 7, 2021 17:40
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runawayturtles posted:2. If you're above the income limit for contributing to a Roth IRA normally but still want to do so, you need to do what's known as a backdoor Roth, which practically requires you to have no money in Traditional/Rollover IRAs. But, if you have a current 401k, you could avoid conversion and the tax hit by just rolling the Rollover IRA into that instead. This is what got me reading about Roth IRAs in the first place, maybe needing to utilize the backdoor option one day. I do have a current 401k but I figured there was a limited window I could rollover? I've had the rollover IRA for a few years, I just assumed I was past any window I could still rollover but I will follow that thread because it seems like the cleanest option if still possible. Thank you!
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Sep 7, 2021 20:14
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Pollyanna posted:I just remembered that I originally hosed up and have about 1.3k in Roth 401k, and Vanguard's telling me "oh you need like 3k to start a Roth IRA" or something. I hope they realize that they'll be rolling into an existing Roth IRA. The 3k is probably the minimum purchase for whichever fund you were looking at. I don’t think there is any kind of lower limit on starting a retirement account.
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Sep 7, 2021 20:17
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Tev posted:This is what got me reading about Roth IRAs in the first place, maybe needing to utilize the backdoor option one day. I do have a current 401k but I figured there was a limited window I could rollover? I've had the rollover IRA for a few years, I just assumed I was past any window I could still rollover but I will follow that thread because it seems like the cleanest option if still possible. Thank you! As far as I know there is no limited window to be concerned about. However, the fact that you have contributed to this IRA after rolling it over means it is technically no longer a Rollover IRA (i.e. an IRA in which all funds came from a 401k) but a standard Traditional IRA. This may or may not make it difficult to roll into your current 401k, it depends on the plan. The other factor to consider is the quality of your current 401k, in terms of funds available and fees charged. If your 401k plan is really bad (and depending on how much money is in your IRA), it may be preferable to take the tax hit and convert it just to make sure you can invest it well. If you're not yet at the point where you need to backdoor, this could be spread out over multiple years. But definitely the easiest option is to roll it into your 401k, if it's decent and they'll accept it.
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Sep 7, 2021 22:40
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runawayturtles posted:As far as I know there is no limited window to be concerned about. However, the fact that you have contributed to this IRA after rolling it over means it is technically no longer a Rollover IRA (i.e. an IRA in which all funds came from a 401k) but a standard Traditional IRA. This may or may not make it difficult to roll into your current 401k, it depends on the plan. My current 401k is with Fidelity and seems to have good options to choose from. I'm on the door step of the AGI limit for Roth contributions so the backdoor option may become a necessity, however the traditional IRA account we're discussing here has over $200k in it, if that helps with context (with my trepidation lol). I don't know for how many more years I'll be at/near the AGI limit either, so if rollover into current 401k doesn't work perhaps I'll just leave the traditional IRA alone and start contributing to a new Roth account as AGI allows? At least that gives me a better spread of withdrawal options at retirement time if I can grow the Roth. Maybe not a good plan to forgo back door options, but it looks like I goofed leaving that Rollover IRA where it was and just contributing to it. I also don't expect to blast past the AGI limit in my current career/retirement trajectory, so not super worried about keeping the backdoor options. That may be really dumb and shortsighted though
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Sep 7, 2021 23:44
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Tev posted:My current 401k is with Fidelity and seems to have good options to choose from. I'm on the door step of the AGI limit for Roth contributions so the backdoor option may become a necessity, however the traditional IRA account we're discussing here has over $200k in it, if that helps with context (with my trepidation lol). I don't know for how many more years I'll be at/near the AGI limit either, so if rollover into current 401k doesn't work perhaps I'll just leave the traditional IRA alone and start contributing to a new Roth account as AGI allows? At least that gives me a better spread of withdrawal options at retirement time if I can grow the Roth. Maybe not a good plan to forgo back door options, but it looks like I goofed leaving that Rollover IRA where it was and just contributing to it. I also don't expect to blast past the AGI limit in my current career/retirement trajectory, so not super worried about keeping the backdoor options. That may be really dumb and shortsighted though Fidelity is good, I'd be surprised if they don't accept your IRA, so might as well start there. If they don't then you'll have plenty of time to figure out/ask about your next best option.
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Sep 8, 2021 00:57
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As of today, I am eligible to enroll in my ESPP through Fidelity. I can put up to 15% of my paycheck in there, which I will, and the benefit is as follows: I have no discounts to the share price, I'm buying them at market through Fidelity, they pay account opening fees and any charges associated with buying shares through the plan, and I pay any commissions, charges, etc, on selling shares (apparently $0 if I do it online and don't bother a live person), like any retail investor would. If I hold the stock for four calendar quarters, 33% of the dollar amount I put in to my account for that single quarter is deposited into my account one year later, to buy more stock. For example, in 2021Q3 I put $12,000 into the ESPP to buy however much stock that can buy. If I hold that stock all the way through 2022Q3, then on the first day of 2022Q4, the company will deposit $4,000 (33% of the $12,000 I put in for that quarter) into my ESPP account to buy however much stock that can buy. There are no restrictions on when I can sell my stock, but if I sell it before that one year hold, I don't get the 33% match. I can resell the 33% bonus at any time as it does not count towards my match for the next year. I guess if the stock doesn't tank more than 33ish % I should come out ahead? I'd probably want to put in all 15% to max out the bonus, as well. Fhqwhgads fucked around with this message at 15:33 on Sep 8, 2021 |
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Sep 8, 2021 15:04
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Getting a free 33% 1yr appreciation is pretty good. The only downside would be if your company’s stock is hella volatile. If it drops by 50%, you’re still going to be negative. If it grows by 50%… well, that’s a good problem to have.
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Sep 8, 2021 15:19
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DNK posted:Getting a free 33% 1yr appreciation is pretty good. Morningstar has it as a 5-year beta of 0.71, so I'm assuming less volatile than the overall market especially for a tech company (though we're really more financial services). It's only been public since 2015, and has been on a growth trajectory as it's been acquiring other companies in my industry, but the most volatile it's been has been March 2020, and well, yeah. Fhqwhgads fucked around with this message at 15:56 on Sep 8, 2021 |
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Sep 8, 2021 15:32
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runawayturtles posted:Yeah, a Roth conversion is taxed as income. There are two main reasons to convert: Can you explain your point 2 to me? I have an old rollover 401 k from many years ago. This year I contributed 6,000 to a traditional IRA (this was money I paid tax on because I'm over all the limits) and then converted it to a Roth. Is this somehow a problem because I had money in a rollover?
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Sep 8, 2021 17:21
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Turds in magma posted:Can you explain your point 2 to me? Yes, assuming the Rollover IRA is traditional. Look up the Pro Rate Rule. If you have $6000 in your Rollover IRA that means you will have the following happen: $3000 from your rollover $3000 from your trad IRA Tax would be your income rate on the $3000 from the rollover. So say you were at 25%, you would owe $750 in tax on the conversion. If you have $100,000 in the Rollover IRA you would have to pay tax on $5640 of the conversion. You have time to avoid this if you have another 401k that you can roll the Rollover IRA into but you will have to do that before the end of the year.
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Sep 8, 2021 17:37
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Turds in magma posted:Can you explain your point 2 to me? Do you mean rollover 401k as in you rolled it over into a Rollover IRA or just a 401k that you left alone sitting in an account with your old job? Conversions from a Traditional IRA to a Roth IRA is a taxable event. When you're starting from zero and making a non-deductible contribution to a Traditional IRA, the tax from the conversion is either $0 or pennies on whatever interest your brokerage might have paid you during the business days it took for the conversion to complete. The reason why a Rollover IRA with a large deductible Traditional IRA balance complicates things is due to something called the pro-rata rule. What this means is that the IRS looks at your Traditional IRA balances in their totality (the balance on December 31st of the relevant tax year of the conversion) for purposes of the conversion, i.e., you're not converting $6,000 of non-deductible contributions, rather you're converting $6,000 of both deductible and non-deductible contributions (more specifically balance since you probably have earnings beyond your contribution in the Rollover IRA), where the non-deductible portion is determined by the ratio of non-deductible contributions to the overall balance. For example, Rollover IRA balance (all deductible): $54,000 Non-deductible Traditional IRA balance: $6,000 Total amount in all IRAs: $60,000 Now you do a $6,000 conversion to a Roth IRA Taxable amount converted: $5,400 Non-taxable amount converted: $600 (your non-deductible contributions are 10% of your total IRA balance, thus 10% of the amount you converted comes from your non-deductible contributions) Basically, you did not only convert the non-deductible money you put in this year, but rather a portion of your Rollover IRA and the non-deductible contribution and will have to calculate tax owed and keep track of how much of your non-deductible money you have going forward.
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Sep 8, 2021 17:44
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Ancillary Character posted:Do you mean rollover 401k as in you rolled it over into a Rollover IRA or just a 401k that you left alone sitting in an account with your old job? I can tell you exactly what I did, maybe that will help. Five years ago I changed jobs. I had a 401 k with my old employer that had about 20 k in it. It was held with Fidelity. In the spirit of trying to simplify the number of accounts I check on, I got this transferred to my Schwab account about four years ago. I didn't take any money out, or put any in, I just bought ETFs with it once it was at Schwab. This year I opened a another account, a traditional IRA, and put 6 k in it. This was cash, from my paycheque, that already has tax deducted. I bought ETFs with the cash in this account. I'm over any/all contribution limits so there was no way I was deducting this contribution. I then converted this account to a Roth IRA. I didn't add/take out any money or sell anything.
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Sep 8, 2021 18:37
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Turds in magma posted:
Looks very likely that you have a Rollover IRA, which means $6,000 * [$6,000 / ($6,000+$20,000+$X)], where X is however much the the Rollover IRA grew since it was $20k five years ago, is how much of your rollover is non-taxable and the rest is taxable. You can either undo the conversion if this is not what you want to deal with or see if you can rollover your Rollover IRA into your current 401k plan before December 31st if you want to keep doing the backdoor Roth and your 401k has options you're happy with.
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Sep 8, 2021 18:55
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Turds in magma posted:In the spirit of trying to simplify the number of accounts I check on, I got this transferred to my Schwab account about four years ago. Did you transfer it to an IRA? If so, you’re going to run afoul of the pro rata rule.
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Sep 8, 2021 18:55
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Are you guys any good for UK advice? I've managed to find myself with £20k-odd in savings and no outstanding debt (mortgage paid off, no car, credit cards paid in full every month), so I'm wondering if I should just leave it in the ISA/Premium Bonds or do something else with it. I have zero financial literacy bar an inherited "save a bit every month for emergencies and don't leave bills in a pile for months they'll only get worse" mindset so I'm kind of wary about putting money somewhere I can't get at it in a hurry but that's probably something I should get over...
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Sep 11, 2021 20:36
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The flowchart mentioned here may help. Alternatively come join us in the UK thread. With inflation at 2-3% right now I’d suggest a stocks and shares ISA over cash assuming you have no immediate need for cash. Dakha fucked around with this message at 08:15 on Sep 12, 2021 |
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Sep 12, 2021 08:12
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Dakha posted:The flowchart mentioned here may help. I think it'd better be the thread; I know sod all about pensions too. Thanks!
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Sep 12, 2021 11:28
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Motronic posted:Yup, some of them sure will. Like Fidelity. To or from Fidelity? I was moving an old 401k from Fidelity and they said per the rules of the plan, they had to send me a check to then send to the new company (Guideline).
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Sep 12, 2021 23:15
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Omne posted:To or from Fidelity? From Fidelity to Vanguard in my case. Could be from Fidelity to anyone.......
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Sep 13, 2021 02:28
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I had to have Fidelity mail me a check when I rolled over my 401k I had with them to Vanguard. The Vanguard app does have a mobile deposit option so you don't have to mail the check to vanguard (if that works, it didn't the first time I had to rollover a 401k to vanguard, but did on the most recent time I did)
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Sep 13, 2021 15:40
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My RSUs have been released, so I want to liquidate the RSUs and ISOs from my now-previous job. Last time I did something with my ISOs, I got kinda hosed over by weirdly-handled taxation on the ISOs. Can someone doublecheck if my plan makes sense? --- Step 0: According to E*TRADE, I am no longer beholden to my previous company's blackout period, so I am free to sell and exercise. Step 1: Sell all sellable RSUs, and take the STCG hit. Step 2: Same-day sale all exercisable ISOs, and take the STCG hit. --- Is that the best way to liquidate them? E: Actually, I'm not really sure if I'm completely in the clear for ditching the RSUs and such. I'll hold on to them for now. Pollyanna fucked around with this message at 17:12 on Sep 13, 2021 |
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Sep 13, 2021 16:45
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Looks like Peter Thiel's multi-billion dollar Roth IRA inspired Dems to try to fix the broken parts of retirement saving. They're looking at doing away with the backdoor and mega-backdoor loopholes, and creating a new framework for RMD's and contributions when a person has over 10 million in retirement assets. https://www.cnbc.com/2021/09/13/house-democrats-propose-new-retirement-plan-rules-for-the-wealthy.html
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Sep 13, 2021 20:23
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acidx posted:Looks like Peter Thiel's multi-billion dollar Roth IRA inspired Dems to try to fix the broken parts of retirement saving. They're looking at doing away with the backdoor and mega-backdoor loopholes, and creating a new framework for RMD's and contributions when a person has over 10 million in retirement assets. I feel like this will never pass the senate (or even the house, given how slim their majority is these days) but god, I hope it does.
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Sep 13, 2021 20:42
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Well that loving blows that they're trying to get rid of backdoor/mega backdoor regardless of account balance
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Sep 13, 2021 21:48
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