Retirement funds: Rollover or cashout?

[treehugger]

I have bounced around from job to job over the last several years, I have several retirement accounts. I left one alone, as it sits with fidelity and I just hadn’t gotten around to rolling it over….My last 3 year stint with the railroad left me a Calpers account totaling $15,000. Question is, do I combine and roll them over into a Roth IRA (or something) or do I cash out, take the tax hits, and add it to my pot for the potential down payment on a house?

Current job is with the federal government and we have a retirement system, but not conventional 401 type of stuff either.

Would appreciate any thoughts or advice. Anybody a financial guru for hire?

[ucodegen]

Rolling the accounts over make it easier to manage.. but with a ‘Roll-over’, you have to be willing to do some of the managing yourself (selection of what to invest in).

Rolling over the 401Ks to a Roth is a different proposition than rolling over to a ‘Rollover 401K’. Roths have the advantage that distributions on earnings from it are not taxed.. with some possible exceptions… but the contributions on a Roth are post tax while a 401K contributions are pre-tax.

401K to Rollover IRA
When you roll over a standard 401K to a roll-over IRA, there are no tax hits. The best way to do it is direct (not taking a distribution and then re-investing within 60 days).

401K to Roth IRA
A roll over of a 401K to a Roth IRA does have a tax hit. The contributions to a 401K are pre-tax, to a Roth they are post-tax. There is a tax adjustment to the amount you roll-over. There are also income tax restrictions. If you have a very low income currently (part time employment, unemployed) the rollover of an 401K to a Roth IRA can be quite effective.

401K for a down on a house
There is a way to use a 401K for a down on the house without getting a full tax hit. I am not certain of the specifics of it.

401K cash out
Doing a straight cash out of a 401K is not recommended. Not only do you get hit with income tax on the amount, potentially moving you into a higher bracket as well, there is also a 10% ‘surcharge’ off the top on the amount.

[ucodegen]

Rolling the accounts over make it easier to manage.. but with a ‘Roll-over’, you have to be willing to do some of the managing yourself (selection of what to invest in).

Rolling over the 401Ks to a Roth is a different proposition than rolling over to a ‘Rollover 401K’. Roths have the advantage that distributions on earnings from it are not taxed.. with some possible exceptions… but the contributions on a Roth are post tax while a 401K contributions are pre-tax.

401K to Rollover IRA
When you roll over a standard 401K to a roll-over IRA, there are no tax hits. The best way to do it is direct (not taking a distribution and then re-investing within 60 days).

401K to Roth IRA
A roll over of a 401K to a Roth IRA does have a tax hit. The contributions to a 401K are pre-tax, to a Roth they are post-tax. There is a tax adjustment to the amount you roll-over. There are also income tax restrictions. If you have a very low income currently (part time employment, unemployed) the rollover of an 401K to a Roth IRA can be quite effective.

401K for a down on a house
There is a way to use a 401K for a down on the house without getting a full tax hit. I am not certain of the specifics of it.

401K cash out
Doing a straight cash out of a 401K is not recommended. Not only do you get hit with income tax on the amount, potentially moving you into a higher bracket as well, there is also a 10% ‘surcharge’ off the top on the amount.

[ucodegen]

Rolling the accounts over make it easier to manage.. but with a ‘Roll-over’, you have to be willing to do some of the managing yourself (selection of what to invest in).

Rolling over the 401Ks to a Roth is a different proposition than rolling over to a ‘Rollover 401K’. Roths have the advantage that distributions on earnings from it are not taxed.. with some possible exceptions… but the contributions on a Roth are post tax while a 401K contributions are pre-tax.

401K to Rollover IRA
When you roll over a standard 401K to a roll-over IRA, there are no tax hits. The best way to do it is direct (not taking a distribution and then re-investing within 60 days).

401K to Roth IRA
A roll over of a 401K to a Roth IRA does have a tax hit. The contributions to a 401K are pre-tax, to a Roth they are post-tax. There is a tax adjustment to the amount you roll-over. There are also income tax restrictions. If you have a very low income currently (part time employment, unemployed) the rollover of an 401K to a Roth IRA can be quite effective.

401K for a down on a house
There is a way to use a 401K for a down on the house without getting a full tax hit. I am not certain of the specifics of it.

401K cash out
Doing a straight cash out of a 401K is not recommended. Not only do you get hit with income tax on the amount, potentially moving you into a higher bracket as well, there is also a 10% ‘surcharge’ off the top on the amount.

[ucodegen]

Rolling the accounts over make it easier to manage.. but with a ‘Roll-over’, you have to be willing to do some of the managing yourself (selection of what to invest in).

Rolling over the 401Ks to a Roth is a different proposition than rolling over to a ‘Rollover 401K’. Roths have the advantage that distributions on earnings from it are not taxed.. with some possible exceptions… but the contributions on a Roth are post tax while a 401K contributions are pre-tax.

401K to Rollover IRA
When you roll over a standard 401K to a roll-over IRA, there are no tax hits. The best way to do it is direct (not taking a distribution and then re-investing within 60 days).

401K to Roth IRA
A roll over of a 401K to a Roth IRA does have a tax hit. The contributions to a 401K are pre-tax, to a Roth they are post-tax. There is a tax adjustment to the amount you roll-over. There are also income tax restrictions. If you have a very low income currently (part time employment, unemployed) the rollover of an 401K to a Roth IRA can be quite effective.

401K for a down on a house
There is a way to use a 401K for a down on the house without getting a full tax hit. I am not certain of the specifics of it.

401K cash out
Doing a straight cash out of a 401K is not recommended. Not only do you get hit with income tax on the amount, potentially moving you into a higher bracket as well, there is also a 10% ‘surcharge’ off the top on the amount.

[ucodegen]

Rolling the accounts over make it easier to manage.. but with a ‘Roll-over’, you have to be willing to do some of the managing yourself (selection of what to invest in).

Rolling over the 401Ks to a Roth is a different proposition than rolling over to a ‘Rollover 401K’. Roths have the advantage that distributions on earnings from it are not taxed.. with some possible exceptions… but the contributions on a Roth are post tax while a 401K contributions are pre-tax.

401K to Rollover IRA
When you roll over a standard 401K to a roll-over IRA, there are no tax hits. The best way to do it is direct (not taking a distribution and then re-investing within 60 days).

401K to Roth IRA
A roll over of a 401K to a Roth IRA does have a tax hit. The contributions to a 401K are pre-tax, to a Roth they are post-tax. There is a tax adjustment to the amount you roll-over. There are also income tax restrictions. If you have a very low income currently (part time employment, unemployed) the rollover of an 401K to a Roth IRA can be quite effective.

401K for a down on a house
There is a way to use a 401K for a down on the house without getting a full tax hit. I am not certain of the specifics of it.

401K cash out
Doing a straight cash out of a 401K is not recommended. Not only do you get hit with income tax on the amount, potentially moving you into a higher bracket as well, there is also a 10% ‘surcharge’ off the top on the amount.

[LuckyInOC]

TH,

You also want to check if you are fully vested in your accounts with matching funds. If you roll-over your accounts you will not be able to roll-over your non-vested amounts from the company. I have a fidelity account that I am 3/4 vested (I was laid-off just before my 5th yr). Unfortunately, I am stuck until I retire or get hired by the company again(large company, small possibility).

Lucky In OC

[LuckyInOC]

TH,

You also want to check if you are fully vested in your accounts with matching funds. If you roll-over your accounts you will not be able to roll-over your non-vested amounts from the company. I have a fidelity account that I am 3/4 vested (I was laid-off just before my 5th yr). Unfortunately, I am stuck until I retire or get hired by the company again(large company, small possibility).

Lucky In OC

[LuckyInOC]

TH,

You also want to check if you are fully vested in your accounts with matching funds. If you roll-over your accounts you will not be able to roll-over your non-vested amounts from the company. I have a fidelity account that I am 3/4 vested (I was laid-off just before my 5th yr). Unfortunately, I am stuck until I retire or get hired by the company again(large company, small possibility).

Lucky In OC

[LuckyInOC]

TH,

You also want to check if you are fully vested in your accounts with matching funds. If you roll-over your accounts you will not be able to roll-over your non-vested amounts from the company. I have a fidelity account that I am 3/4 vested (I was laid-off just before my 5th yr). Unfortunately, I am stuck until I retire or get hired by the company again(large company, small possibility).

Lucky In OC

[LuckyInOC]

TH,

You also want to check if you are fully vested in your accounts with matching funds. If you roll-over your accounts you will not be able to roll-over your non-vested amounts from the company. I have a fidelity account that I am 3/4 vested (I was laid-off just before my 5th yr). Unfortunately, I am stuck until I retire or get hired by the company again(large company, small possibility).

Lucky In OC

[5yearwaiter]

[quote=ucodegen]Rolling the accounts over make it easier to manage.. but with a ‘Roll-over’, you have to be willing to do some of the managing yourself (selection of what to invest in).

401K for a down on a house
There is a way to use a 401K for a down on the house without getting a full tax hit. I am not certain of the specifics of it.
[/quote]

I want to know about this with detalis if anyone knows.I doubt we can do this without tax hit

[5yearwaiter]

[quote=ucodegen]Rolling the accounts over make it easier to manage.. but with a ‘Roll-over’, you have to be willing to do some of the managing yourself (selection of what to invest in).

401K for a down on a house
There is a way to use a 401K for a down on the house without getting a full tax hit. I am not certain of the specifics of it.
[/quote]

I want to know about this with detalis if anyone knows.I doubt we can do this without tax hit

[5yearwaiter]

[quote=ucodegen]Rolling the accounts over make it easier to manage.. but with a ‘Roll-over’, you have to be willing to do some of the managing yourself (selection of what to invest in).

401K for a down on a house
There is a way to use a 401K for a down on the house without getting a full tax hit. I am not certain of the specifics of it.
[/quote]

I want to know about this with detalis if anyone knows.I doubt we can do this without tax hit

[5yearwaiter]

[quote=ucodegen]Rolling the accounts over make it easier to manage.. but with a ‘Roll-over’, you have to be willing to do some of the managing yourself (selection of what to invest in).

401K for a down on a house
There is a way to use a 401K for a down on the house without getting a full tax hit. I am not certain of the specifics of it.
[/quote]

I want to know about this with detalis if anyone knows.I doubt we can do this without tax hit

[Author]

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