In reality though the 10% discount is a 1 time savings. So since the stock seems to stay flat you are only making what the dividend pays, which is about what? 3%. We should be able to do better than 3% with our money. So if you sell it as soon as the 2 year hold has expired than you made 5%. And I buy it. Maybe my math is wrong.
% to contribute to 401k
- Thread starter wwinvestor
- Start date
Very good post. The UPS stock has gone absolutely nowhere in the last 9 years. If you bought it right after 911 you made money but you could say that about almost any stock out there. Max your 401(k) and then worry about buying UPS stock.
UpstateNYUPSer(Ret)
Well-Known Member
Favrefan, you are right, I was using the figures of a full-time seniority package card driver at top rate for my calculations so, using your example of a part-timer or a FT driver not yet a top pay, I agree that the 35% limit would benefit them. However, are you sure about being able to access the 401k at age 55 1/2 rather than 59 1/2?
brownmonster
Man of Great Wisdom
I think you can get your 401K money at 55 if you retire or separate from the company.
browniehound
Well-Known Member
Brown,
From what I understand, you can tap your 401k later in life (or anytime) in the following way:
At a certain age the government will assume you have a certain life-expectancy. You are allowed to withdraw from your 401K at any age if you make equal (monthly?) withdrawals, and continue making the same equal withdrawals until you reach that estimated age.
I'm a layman, but I believe the above statement to be true (or close).
Can someone with some expertise please chime in and correct me or solidify my belief?
Thanks,
Brownie
browniehound
Well-Known Member
Monster,
When you leave the company before 59.5 your are entitled to 100% of your 401k minus income tax and 10% early withdrawal penalty.
Obviously if you left the company before 59.5, the wise thing to do would be to roll it over to an IRA to defer all taxes.
Actually for the Teamster plan....this is how it is. If you continue to work...59 1/2 w/no penalties. If you are completely retired....55 1/2 w/no penalties. Either way working or not....70 1/2 you have to start taking at least 10% per year. Tax must be paid but without the 10% penalty if you follow the above numbers. Don't have time today, but I will look for proof of the 55 1/2 rule soon. It's not well known and kept on the down low.
