Finally liquidated my 401k and SEP IRA

[Anonymous]

Keep in mind you have 60 days to roll it into another IRA (the funds from the SEP and the IRA). In other words your decision is not final until 60 days is up from when you took the money out.

No question in my book that borrowing half makes a lot of sense. At the very least pulling some of the money out in two or three different tax years would lower the taxes (depends on the amount. Put half of it back in and do the other half next year.

Alex

[FormerOwner]

Well, Piggs, what about this question: I work for a company that matches my 401(K) contributions up to a certain percentage of my salary. I am contributing that percentage of my salary just so I can get the maximum company match and have both my contribution and the company’s go into the account tax free. The only problem is that all of their investment choices I can pick from suck. I picked what I think is the best of a bunch of horrible options – a mix of 3 bond funds that each have a mix of short-term bonds, one fund also has some treasuries, and long-term bonds. I figure that even if the value of the funds drops in half, I’ll still be ahead. However, I sometimes feel like a sucker for even being part of a 401(K). Should I stop putting my money in there?

[FormerOwner]

Well, Piggs, what about this question: I work for a company that matches my 401(K) contributions up to a certain percentage of my salary. I am contributing that percentage of my salary just so I can get the maximum company match and have both my contribution and the company’s go into the account tax free. The only problem is that all of their investment choices I can pick from suck. I picked what I think is the best of a bunch of horrible options – a mix of 3 bond funds that each have a mix of short-term bonds, one fund also has some treasuries, and long-term bonds. I figure that even if the value of the funds drops in half, I’ll still be ahead. However, I sometimes feel like a sucker for even being part of a 401(K). Should I stop putting my money in there?

[FormerOwner]

Well, Piggs, what about this question: I work for a company that matches my 401(K) contributions up to a certain percentage of my salary. I am contributing that percentage of my salary just so I can get the maximum company match and have both my contribution and the company’s go into the account tax free. The only problem is that all of their investment choices I can pick from suck. I picked what I think is the best of a bunch of horrible options – a mix of 3 bond funds that each have a mix of short-term bonds, one fund also has some treasuries, and long-term bonds. I figure that even if the value of the funds drops in half, I’ll still be ahead. However, I sometimes feel like a sucker for even being part of a 401(K). Should I stop putting my money in there?

[FormerOwner]

Well, Piggs, what about this question: I work for a company that matches my 401(K) contributions up to a certain percentage of my salary. I am contributing that percentage of my salary just so I can get the maximum company match and have both my contribution and the company’s go into the account tax free. The only problem is that all of their investment choices I can pick from suck. I picked what I think is the best of a bunch of horrible options – a mix of 3 bond funds that each have a mix of short-term bonds, one fund also has some treasuries, and long-term bonds. I figure that even if the value of the funds drops in half, I’ll still be ahead. However, I sometimes feel like a sucker for even being part of a 401(K). Should I stop putting my money in there?

[FormerOwner]

Well, Piggs, what about this question: I work for a company that matches my 401(K) contributions up to a certain percentage of my salary. I am contributing that percentage of my salary just so I can get the maximum company match and have both my contribution and the company’s go into the account tax free. The only problem is that all of their investment choices I can pick from suck. I picked what I think is the best of a bunch of horrible options – a mix of 3 bond funds that each have a mix of short-term bonds, one fund also has some treasuries, and long-term bonds. I figure that even if the value of the funds drops in half, I’ll still be ahead. However, I sometimes feel like a sucker for even being part of a 401(K). Should I stop putting my money in there?

[clearfund]

You should check with your administrator and see if you can rollover all/part of your 401k to a new IRA at a custodian where you have more choices.

Specifically, be sure and get a specific response to the ability to rollover 1) your deferred salary i.e. your contributon; and/or 2) your employers contribution.

To me, the most interesting exception being the fact that the law only applies to your pre-tax salary deferrals. You CAN rollover (or otherwise withdraw) employer contributions, or employee (after-tax or rollover) contributions.

Be sure to find out if there are any required taxes or penalties.

In summary, you should be able to rollover at least a portion of your 401k to a custodian that gives you more choices. It may be a traditional brokerage such as Schwab/Fidelity/Morgan, or my favorite a Self Directed IRA.

Regardless be sure they address the 2 different ‘buckets’ of contributions as every plan has its own unique rules.

[clearfund]

You should check with your administrator and see if you can rollover all/part of your 401k to a new IRA at a custodian where you have more choices.

Specifically, be sure and get a specific response to the ability to rollover 1) your deferred salary i.e. your contributon; and/or 2) your employers contribution.

To me, the most interesting exception being the fact that the law only applies to your pre-tax salary deferrals. You CAN rollover (or otherwise withdraw) employer contributions, or employee (after-tax or rollover) contributions.

Be sure to find out if there are any required taxes or penalties.

In summary, you should be able to rollover at least a portion of your 401k to a custodian that gives you more choices. It may be a traditional brokerage such as Schwab/Fidelity/Morgan, or my favorite a Self Directed IRA.

Regardless be sure they address the 2 different ‘buckets’ of contributions as every plan has its own unique rules.

[clearfund]

You should check with your administrator and see if you can rollover all/part of your 401k to a new IRA at a custodian where you have more choices.

Specifically, be sure and get a specific response to the ability to rollover 1) your deferred salary i.e. your contributon; and/or 2) your employers contribution.

To me, the most interesting exception being the fact that the law only applies to your pre-tax salary deferrals. You CAN rollover (or otherwise withdraw) employer contributions, or employee (after-tax or rollover) contributions.

Be sure to find out if there are any required taxes or penalties.

In summary, you should be able to rollover at least a portion of your 401k to a custodian that gives you more choices. It may be a traditional brokerage such as Schwab/Fidelity/Morgan, or my favorite a Self Directed IRA.

Regardless be sure they address the 2 different ‘buckets’ of contributions as every plan has its own unique rules.

[clearfund]

You should check with your administrator and see if you can rollover all/part of your 401k to a new IRA at a custodian where you have more choices.

Specifically, be sure and get a specific response to the ability to rollover 1) your deferred salary i.e. your contributon; and/or 2) your employers contribution.

To me, the most interesting exception being the fact that the law only applies to your pre-tax salary deferrals. You CAN rollover (or otherwise withdraw) employer contributions, or employee (after-tax or rollover) contributions.

Be sure to find out if there are any required taxes or penalties.

In summary, you should be able to rollover at least a portion of your 401k to a custodian that gives you more choices. It may be a traditional brokerage such as Schwab/Fidelity/Morgan, or my favorite a Self Directed IRA.

Regardless be sure they address the 2 different ‘buckets’ of contributions as every plan has its own unique rules.

[clearfund]

You should check with your administrator and see if you can rollover all/part of your 401k to a new IRA at a custodian where you have more choices.

Specifically, be sure and get a specific response to the ability to rollover 1) your deferred salary i.e. your contributon; and/or 2) your employers contribution.

To me, the most interesting exception being the fact that the law only applies to your pre-tax salary deferrals. You CAN rollover (or otherwise withdraw) employer contributions, or employee (after-tax or rollover) contributions.

Be sure to find out if there are any required taxes or penalties.

In summary, you should be able to rollover at least a portion of your 401k to a custodian that gives you more choices. It may be a traditional brokerage such as Schwab/Fidelity/Morgan, or my favorite a Self Directed IRA.

Regardless be sure they address the 2 different ‘buckets’ of contributions as every plan has its own unique rules.

[Anonymous]

Similar situation, early 30s with solo 401 and other ira’s. I have not liquidated my plans but have thought about it. I cannot stomach the tax penalties for withdrawal. So I moved investments into a money market fund within the plans. The plans currently grow only with contributions. I dont like the current market downside risk. I’m thinking the self directed plan is a better option to gain more control.

[Anonymous]

Similar situation, early 30s with solo 401 and other ira’s. I have not liquidated my plans but have thought about it. I cannot stomach the tax penalties for withdrawal. So I moved investments into a money market fund within the plans. The plans currently grow only with contributions. I dont like the current market downside risk. I’m thinking the self directed plan is a better option to gain more control.

[Anonymous]

Similar situation, early 30s with solo 401 and other ira’s. I have not liquidated my plans but have thought about it. I cannot stomach the tax penalties for withdrawal. So I moved investments into a money market fund within the plans. The plans currently grow only with contributions. I dont like the current market downside risk. I’m thinking the self directed plan is a better option to gain more control.

[Anonymous]

Similar situation, early 30s with solo 401 and other ira’s. I have not liquidated my plans but have thought about it. I cannot stomach the tax penalties for withdrawal. So I moved investments into a money market fund within the plans. The plans currently grow only with contributions. I dont like the current market downside risk. I’m thinking the self directed plan is a better option to gain more control.

[Author]

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