|
Christobevii3 posted:Is there any point to a 457 plan? It seems you are limited to investments off a list with relatively high expenses. With the required tmrs, i put 1 part in and the city puts 2 parts in, so that is pretty good, 5% of my income is contributed at 15% in reality. But i'm trying to decide how else to save? The general wisdom is to contribute just enough to your 401(k) or 457 to get the maximum matching that your employer offers. Then funding a Roth IRA to the max is a good idea. If you think you'll be in a higher tax bracket in the future, a Roth IRA is beneficial because you pay taxes once now, and then you get to take all the money out later tax-free. If you have any left after that, you can go back and put it in your 457, but like you said, you have limited investment options there.
|
#
¿
Jul 4, 2008 01:58
|
|
|
|
| # ¿ Apr 27, 2024 14:39 |
|
|
ZeroAX posted:Thanks, thats a good idea. I'm not sure, but it looks like they're saying that maybe Vanguard can't hold the funds you currently have with Schwab. It sounds like you can still roll it over, but you have the sell the funds first. This could have tax implications -- I'm not sure -- but at least you won't be withdrawing the money and facing penalties for that. Of course, you'll probably want to check with Vanguard for the details. I'm just guessing here.
|
|
#
¿
Jul 6, 2008 02:09
|
|
|
80k posted:No, it seems pretty clear that he is not trying to move his fund shares over "in kind", but wants them going into Vanguard funds. So it has nothing to do with the funds that he is holding at Schwab. Thanks for clearing this up.
|
|
#
¿
Jul 6, 2008 04:27
|
|
|
Sympathetic Wasp posted:I'm an idiot when it comes to anything financially other than a savings account. I currently contribute 6% pretax to a company matched (max match is 6%, so I'm maxed out) Principal 401(k). When I signed up for it, I picked my retirement year, and the funds "are automatically moved around for maximum return". I'm sure later I'll get into what I'm actually investing in, but not right now. What I'm interested in now is supplementing that retirement account with a Roth IRA. If I'm reading correctly, I can take a max of $5k a year and contribute that to a Roth IRA, and then much like my 401(k), choose where to invest it. Is that correct? Is there anything else that I should be doing? Are there caps to how much you can contribute overall (I make $50k a year, so 6% pretax and if I put in $5k in a Roth, that would be a total of 16% yearly)? You definitely seem to be on right track so don't sell yourself short. You're exactly right about the Roth IRA - it's a retirement account that you open on your own and fund yourself (Up to $5,000 a year for 2008) The annual limit for contributing to your 401(k) is $15,500 (for 2008). You are contributing 6% to get the max company match, which is good, but you have room to contribute more if you want to. Here's the usual advice for how to save your money for retirement: Step 1. Fund 401(k) up to max company matching levels (you've got this down) Step 2. Fund Roth IRA to the yearly max Step 3. For additional savings, go back and increase 401(k) funding Don't think of the 6% as a limit. Think of it more like a floor. Any less than that is dumb because you'd be missing out on free money. If you put more than 6% in, you won't get matching funds, but you will save more, which is key. Here's a link from the Motley Fool which goes through the basics of retirement saving really well in my opinion: http://www.fool.com/Retirement/Retirement01.htm
|
|
#
¿
Jul 9, 2008 18:51
|
|
|
Kobayashi posted:Oh now this is interesting. I'm doing steps 1 and 3, which is to say, I am maxing out my 401(k). I only receive matching funds up to 5%, though. Should I go ahead and scale back my 401(k) contributions immediately and contribute the difference to the Roth, or should I just do it properly next year? I think personal finance experts love Roth IRAs because of the tax benefits that are especially apparent for younger, poorer people. If I'm making 10, 20 or 30 grand a year now, I'm pretty sure my tax bracket will be higher when I'm older, and I will benefit from the Roth. So, I don't know if it's worth it for you to re-configure things this year. But I'm pretty sure you have until April 2009 to make Roth contributions for 2008 so that's something to think about as well. Edit: In a Roth IRA you have total control of how your money is invested, whereas in a 401(k), you're limited to their fund choices. Just one more thing to factor in.
|
|
#
¿
Jul 11, 2008 02:17
|
|
|
|
| # ¿ Apr 27, 2024 14:39 |
|
|
Day 29 in Search for Lost Hog posted:I'm pretty new to this saving for retirement business. I want to open a roth IRA with Vanguard but I have just started working and am just starting to have a good amount of money in my checking account. It seems like I need a minimum $3000 to open one (multiple times that to split between different funds) , which I don't have. I guess my question is how much should I have saved up before I open a Roth IRA and start contributing to it. I recently opened a Roth IRA at Vanguard with $1000. The only fund with a $1000 minimum is the STAR Fund, which is a fund of funds. I'm not too concerned about my asset allocation right now because I have so little money. I figure once my balance gets higher I can spread it out among index funds.
|
|
#
¿
Aug 4, 2008 19:19
|
|