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401K money
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<blockquote data-quote="Just another UPSer" data-source="post: 211924"><p>***Remember*****</p><p><span style="font-size: 10px">Take out your 401K if you leave a job. A lot of people don’t know that they can get back they money they put in minus the interest. I think it is a year’s time before you can not get the money back at all. If you don’t ask for it companies will not offer it</span></p></blockquote><p></p><p> Do not take your money out when you leave a job (they must keep 20% for taxes and you will get part of this back when you file your tax return.) Instead roll it over to an IRA or some companies allow you to roll it over to their 401k. I am a seasonal tax preparer for H & R and I cannot tell you the number of times I see this. There is also a 10% penalty if you are not at least 59 and 1/2. Or last year someone told a guy that because he was a first time home owner he could take money out of his 401k without penalty--you can do this with an IRA but not a 401k. Some companies will automatically cut you a check for your 401k if the balance is below a certain amount. (Set up an IRA with the money to avoid the 10% penalty and to keep your retirement funding intact.) I have never heard of losing the interest on a 401k--you should get your total balance back unless they charge you a transfer fee. </p><p> </p><p> I am a Suzie Orman fan and she said something about a year ago that really stuck with me. She is thinking that the tax rates we have right now are the lowest we will ever see. If you are going to end up with approximately the same amount of income (Pension and instruments that have never been taxed--401k's and IRAs--it makes no sense to put as much as possible in a 401k due to the higher tax rates she is thinking we will have. Instead, she suggested just getting your employer match in a 401k, fully funding a ROTH IRA is you are eligible due to income levels and putting the rest in a taxable account. Now, if you are not going to automatically put money in a taxable account--fund the 401k. It is easier to fund retirement when it is done automatically or we find excuses not to do it. </p><p></p><p> I too am afraid of a stock market meltdown. I had 20% in the 500, 400 Russell, International, 10% in one of the target funds, and 5% each in the Stable Value and Govt Bond funds--trying to diversify but would move some money from a lower to a higher performing fund. Right now I have over 60% in the Stable Value and the Govt Bond funds. It ticks me off that there is no money market fund where you could go to cash, especially seeing 4.5% on INGDirect on savings. There are higher % internet savings accts, but I really like that one. Ease of use. I always like to listen to what other people think so please keep posting on this subject.</p><p>[/QUOTE]</p>
[QUOTE="Just another UPSer, post: 211924"] ***Remember***** [SIZE=2]Take out your 401K if you leave a job. A lot of people don’t know that they can get back they money they put in minus the interest. I think it is a year’s time before you can not get the money back at all. If you don’t ask for it companies will not offer it[/SIZE][/QUOTE] Do not take your money out when you leave a job (they must keep 20% for taxes and you will get part of this back when you file your tax return.) Instead roll it over to an IRA or some companies allow you to roll it over to their 401k. I am a seasonal tax preparer for H & R and I cannot tell you the number of times I see this. There is also a 10% penalty if you are not at least 59 and 1/2. Or last year someone told a guy that because he was a first time home owner he could take money out of his 401k without penalty--you can do this with an IRA but not a 401k. Some companies will automatically cut you a check for your 401k if the balance is below a certain amount. (Set up an IRA with the money to avoid the 10% penalty and to keep your retirement funding intact.) I have never heard of losing the interest on a 401k--you should get your total balance back unless they charge you a transfer fee. I am a Suzie Orman fan and she said something about a year ago that really stuck with me. She is thinking that the tax rates we have right now are the lowest we will ever see. If you are going to end up with approximately the same amount of income (Pension and instruments that have never been taxed--401k's and IRAs--it makes no sense to put as much as possible in a 401k due to the higher tax rates she is thinking we will have. Instead, she suggested just getting your employer match in a 401k, fully funding a ROTH IRA is you are eligible due to income levels and putting the rest in a taxable account. Now, if you are not going to automatically put money in a taxable account--fund the 401k. It is easier to fund retirement when it is done automatically or we find excuses not to do it. I too am afraid of a stock market meltdown. I had 20% in the 500, 400 Russell, International, 10% in one of the target funds, and 5% each in the Stable Value and Govt Bond funds--trying to diversify but would move some money from a lower to a higher performing fund. Right now I have over 60% in the Stable Value and the Govt Bond funds. It ticks me off that there is no money market fund where you could go to cash, especially seeing 4.5% on INGDirect on savings. There are higher % internet savings accts, but I really like that one. Ease of use. I always like to listen to what other people think so please keep posting on this subject. [/QUOTE]
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