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Thread started 06/11/18 10:09pm

PennyPurple

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Any financial guru's here?

My boss is retiring at the end of this year, and after 31 years of working for him, I'll be without a job.

I have a 401K plan that I'm going to have to do something with.


I met with my banker today from Merrill Lynch, the options he gave me was...1. Cash it out and go liquid, 2. roll it over to an Ira. 3. See if I can let it ride where it is now.


The problem I'm having is at my age and no college background I might have a rough time getting a job, and I haven't been on a job interview for 31 years, so Imma whole lotta rusty. I don't need the money right this instant but may get in a finacial bind if I can't find a job.


I will probably turn it over to an IRA because I'm 55 now and I can withdraw without a penality at 59 1/2 if I need it. I think I can hang on until 59 1/2 because if I have to, I will go to work at a fast food place, or something.


Now, what I wanted to do today was go ahead and open an IRA, so I could easily transfer the 401k to it. The banker/Merrill Lynch guy said that I need at least 5000.00 to open an IRA. Does that sound right? Because I don't have 5k to open an IRA just to make the transfer easier. And he also said that in order for me to roll it over to IRA, I need at least 20,000.00 in it, which unless my 401 loses alot of money between now and the end of the year, shouldn't be a problem.


He also said with their IRA's there are 3 types.

1. Self Directed, no fee I would have to figure out where everything goes.

2. Would be I could control where it goes and they would guide me. 0.45% fee

3. Fully managed account, with them managing it at 0.85% fee.


I know I won't go with option 1. Option 2 is plausable. 3. give it to them and let them do it?


I will probably not ever be able to retire. I have credit card debt. Husband is disabled and can't work. I can't draw from my social security til I'm 67 and quite frankly it's a measly amount.


So what do I do? Should I find someone else to open an IRA with and if so, with who?


He said that the 401 plan should be able to cut me a check in my name, and all I had to do was bring the check to them and then we would set the IRA up. My question was if the check is in my name, would I have to pay taxes on that, when I'm rolling it over? He didn't know.


Any and all advice is welcome.

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Reply #1 posted 06/12/18 3:38pm

728huey

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It shouldn't cost that much to roll over your 401K plan to an IRA, though I think that $5,000 amount he quoted you is the maximum annual contribution you can make to you IRA and not any minimum amount to open one. However, it will cost a little bit to open an IRA simply because of the legal tax paperwork involved plus some minimum amount of savings to invest. As for rollovers from a 401K plan, there shouldn't be any minimum or maximum amount you need to roll over into an IRA since the cost will most likely be deducted from your 401K balance.

But if you roll over your 401K savings into a Roth IRA, you will have to pay taxes on your 401K balance though there shouldn't be any penalties for that, and you won't be taxed on any earnings made into your Roth IRA after the rollover as it is considered after-tax income.

typing
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Reply #2 posted 06/12/18 3:38pm

luv4u

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Talk to an accountant

Edmonton, AB - canada

Ohh purple joy oh purple bliss oh purple rapture!
REAL MUSIC by REAL MUSICIANS - Prince
"I kind of wish there was a reason for Prince to make the site crash more" ~~ Ben
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Reply #3 posted 06/12/18 3:49pm

PennyPurple

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728huey said:

It shouldn't cost that much to roll over your 401K plan to an IRA, though I think that $5,000 amount he quoted you is the maximum annual contribution you can make to you IRA and not any minimum amount to open one. However, it will cost a little bit to open an IRA simply because of the legal tax paperwork involved plus some minimum amount of savings to invest. As for rollovers from a 401K plan, there shouldn't be any minimum or maximum amount you need to roll over into an IRA since the cost will most likely be deducted from your 401K balance. But if you roll over your 401K savings into a Roth IRA, you will have to pay taxes on your 401K balance though there shouldn't be any penalties for that, and you won't be taxed on any earnings made into your Roth IRA after the rollover as it is considered after-tax income. typing

Thank you huey!


I don't think I will do the Roth IRA. And I know I will not be contributing, because I just don't and won't have the $$ to do that, it's kind of a let ride thing.


I'm getting so flustered that I'm about ready to say cash the thing out and forget about it. Because I will always have to work.

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Reply #4 posted 06/12/18 4:03pm

PennyPurple

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luv4u said:

Talk to an accountant

I did. The boss had his accountant come in and talk to us. All he said was we could cash it out or do an IRA. sad

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Reply #5 posted 06/12/18 4:31pm

Genesia

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You don't have to pay anything to do a rollover IRA or make an upfront deposit to open the account. Merrill Lynch guy is just telling you what THEY do. Other companies may do better for you.

When I left a job years ago, I opened a Fidelity rollover account. It was super easy to transfer the money and I paid nothing. I picked the funds I wanted to invest in, myself. It was a piece of cake. (I am not affiliated with Fidelity in any way.)

https://www.fidelity.com/...k-rollover

We don’t mourn artists because we knew them. We mourn them because they helped us know ourselves.
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Reply #6 posted 06/12/18 4:34pm

Genesia

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Oh - and you can withdraw the money without a penalty at 55 if leaving your job was not voluntary. But you WILL pay income taxes on that money - which you really, really don't want to do. Make sure the money never comes into your own hands. Absolutely, positively do a rollover.

We don’t mourn artists because we knew them. We mourn them because they helped us know ourselves.
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Reply #7 posted 06/12/18 4:49pm

PennyPurple

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Genesia said:

Oh - and you can withdraw the money without a penalty at 55 if leaving your job was not voluntary. But you WILL pay income taxes on that money - which you really, really don't want to do. Make sure the money never comes into your own hands. Absolutely, positively do a rollover.

Thank you Genesia. I really appreciate it.

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Reply #8 posted 06/12/18 5:33pm

luv4u

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Genesia said:

Oh - and you can withdraw the money without a penalty at 55 if leaving your job was not voluntary. But you WILL pay income taxes on that money - which you really, really don't want to do. Make sure the money never comes into your own hands. Absolutely, positively do a rollover.


Can you have the income taken off already so when it comes income tax time you won't get taxed?

Edmonton, AB - canada

Ohh purple joy oh purple bliss oh purple rapture!
REAL MUSIC by REAL MUSICIANS - Prince
"I kind of wish there was a reason for Prince to make the site crash more" ~~ Ben
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Reply #9 posted 06/12/18 5:46pm

Genesia

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luv4u said:



Genesia said:


Oh - and you can withdraw the money without a penalty at 55 if leaving your job was not voluntary. But you WILL pay income taxes on that money - which you really, really don't want to do. Make sure the money never comes into your own hands. Absolutely, positively do a rollover.




Can you have the income taken off already so when it comes income tax time you won't get taxed?



What difference does that make? You want not to be taxed, at all - which is why you do a rollover.
We don’t mourn artists because we knew them. We mourn them because they helped us know ourselves.
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Reply #10 posted 06/12/18 7:59pm

PennyPurple

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Genesia, thank you very much. Fidelity is the way to go. It seems easy peasy, and a no hassle rollover, nothing like with the Merrill Lynch guy yesterday!! And I got answers to my questions with Fidelity. Thanks again.

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Reply #11 posted 06/13/18 3:59am

SuperFurryAnim
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Yep avoid paying the penalty it is too high a price to pay. I don't think you are too old and have confidence going into the interview as you strike me as a smart person from interactions on the org. Just go on some test run interviews if possible. Plan on getting another job with 401k and if not roll it over to IRA.

You better Watch Out! I'm a WAR MACHINE!
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Reply #12 posted 06/13/18 5:35am

PennyPurple

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SuperFurryAnimal said:

Yep avoid paying the penalty it is too high a price to pay. I don't think you are too old and have confidence going into the interview as you strike me as a smart person from interactions on the org. Just go on some test run interviews if possible. Plan on getting another job with 401k and if not roll it over to IRA.

Thanks Furry.

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Reply #13 posted 06/13/18 7:32am

poppys

PennyPurple said:

Genesia, thank you very much. Fidelity is the way to go. It seems easy peasy, and a no hassle rollover, nothing like with the Merrill Lynch guy yesterday!! And I got answers to my questions with Fidelity. Thanks again.


That's good Penny. You can go to Fidelity or Charles Schwab too. They both still have brick & mortar outlets. Go in, sit down, and ask all your questions, doesn't mean you have to choose them. Make comparisons. Some are offering bonuses to sign up from what I see online. Whoever you go with, check and see what they are offering online too, they might not tell you.

Had an experience with a bank account recently. Opened it at the bank only to go online and find a free checking option at the same bank. He just sold me the one with fees even though I specifically asked for free checking and was told - "we" don't offer that. Turns out, the bank DOES offer that, but only online so technically he wasn't lying to me, lol. Was able to switch to the free one after I got the information.

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Reply #14 posted 06/13/18 1:35pm

PennyPurple

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poppys said:

PennyPurple said:

Genesia, thank you very much. Fidelity is the way to go. It seems easy peasy, and a no hassle rollover, nothing like with the Merrill Lynch guy yesterday!! And I got answers to my questions with Fidelity. Thanks again.


That's good Penny. You can go to Fidelity or Charles Schwab too. They both still have brick & mortar outlets. Go in, sit down, and ask all your questions, doesn't mean you have to choose them. Make comparisons. Some are offering bonuses to sign up from what I see online. Whoever you go with, check and see what they are offering online too, they might not tell you.

Had an experience with a bank account recently. Opened it at the bank only to go online and find a free checking option at the same bank. He just sold me the one with fees even though I specifically asked for free checking and was told - "we" don't offer that. Turns out, the bank DOES offer that, but only online so technically he wasn't lying to me, lol. Was able to switch to the free one after I got the information.

Can't even trust banks these days.

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Reply #15 posted 06/13/18 2:04pm

Genesia

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PennyPurple said:

poppys said:


That's good Penny. You can go to Fidelity or Charles Schwab too. They both still have brick & mortar outlets. Go in, sit down, and ask all your questions, doesn't mean you have to choose them. Make comparisons. Some are offering bonuses to sign up from what I see online. Whoever you go with, check and see what they are offering online too, they might not tell you.

Had an experience with a bank account recently. Opened it at the bank only to go online and find a free checking option at the same bank. He just sold me the one with fees even though I specifically asked for free checking and was told - "we" don't offer that. Turns out, the bank DOES offer that, but only online so technically he wasn't lying to me, lol. Was able to switch to the free one after I got the information.

Can't even trust banks these days.


That's why I've been a credit union member since 1992.

We don’t mourn artists because we knew them. We mourn them because they helped us know ourselves.
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Reply #16 posted 06/13/18 2:35pm

poppys

Genesia said:

PennyPurple said:

Can't even trust banks these days.


That's why I've been a credit union member since 1992.


Another really good suggestion.

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Reply #17 posted 06/13/18 3:37pm

2freaky4church
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If you worked somewhere for 31 years getting another job should be decent. What job did you do? I'm po and a lot more screwed than you. lol

Roth IRA's are the best also there is the Vanguard fund. It is a vanilla mutual fund, the safest out there. Dean Baker loves that. I wouldn't retire if I were you until 70 if you can. Only way to get full Social Security. Where do you live?

"My motherfucker's so cool sheep count him."
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Reply #18 posted 06/13/18 4:03pm

PennyPurple

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2freaky4church1 said:

If you worked somewhere for 31 years getting another job should be decent. What job did you do? I'm po and a lot more screwed than you. lol

Roth IRA's are the best also there is the Vanguard fund. It is a vanilla mutual fund, the safest out there. Dean Baker loves that. I wouldn't retire if I were you until 70 if you can. Only way to get full Social Security. Where do you live?

I live in Kansas City, I am an office manager at a dentist office, and when needed I also assist. I really want to try to get on at a local hospital in admitting. The thing about a hospital is that it's open 24/7 and on holidays, I'm getting to old and have my own family to have to work holidays. LOL


Several years ago I applied at the hospital for a weekend job in admitting for a 2nd job. They wrote me back and said I didn't have enough experience. eek I do everything at the job I have now, scheduling the appointments, billing, payments, coding, insurance, payroll, assist the Dr. in the back, sterilize instruments etc.


I'm spoiled, I don't want to have to work the night shift, my husband is disabled, and I have responsibilites to care for him. Right now I have no problem with my boss and me being able to take off work to take my hubby for his Dr. appointments. What am I going to do when I get a new job and can't take off work?


I'm nothing but a worry wart. sad

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Reply #19 posted 06/13/18 4:09pm

poppys

PennyPurple said:

2freaky4church1 said:

If you worked somewhere for 31 years getting another job should be decent. What job did you do? I'm po and a lot more screwed than you. lol

Roth IRA's are the best also there is the Vanguard fund. It is a vanilla mutual fund, the safest out there. Dean Baker loves that. I wouldn't retire if I were you until 70 if you can. Only way to get full Social Security. Where do you live?

I live in Kansas City, I am an office manager at a dentist office, and when needed I also assist. I really want to try to get on at a local hospital in admitting. The thing about a hospital is that it's open 24/7 and on holidays, I'm getting to old and have my own family to have to work holidays. LOL


Several years ago I applied at the hospital for a weekend job in admitting for a 2nd job. They wrote me back and said I didn't have enough experience. eek I do everything at the job I have now, scheduling the appointments, billing, payments, coding, insurance, payroll, assist the Dr. in the back, sterilize instruments etc.


I'm spoiled, I don't want to have to work the night shift, my husband is disabled, and I have responsibilites to care for him. Right now I have no problem with my boss and me being able to take off work to take my hubby for his Dr. appointments. What am I going to do when I get a new job and can't take off work?


I'm nothing but a worry wart. sad


Why are you thinking about the hospital? What about another dentist or a daytime clinic? If you want to stick with office management you have experience and beaucoup dental experience.

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Reply #20 posted 06/13/18 4:48pm

PennyPurple

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poppys said:

PennyPurple said:

I live in Kansas City, I am an office manager at a dentist office, and when needed I also assist. I really want to try to get on at a local hospital in admitting. The thing about a hospital is that it's open 24/7 and on holidays, I'm getting to old and have my own family to have to work holidays. LOL


Several years ago I applied at the hospital for a weekend job in admitting for a 2nd job. They wrote me back and said I didn't have enough experience. eek I do everything at the job I have now, scheduling the appointments, billing, payments, coding, insurance, payroll, assist the Dr. in the back, sterilize instruments etc.


I'm spoiled, I don't want to have to work the night shift, my husband is disabled, and I have responsibilites to care for him. Right now I have no problem with my boss and me being able to take off work to take my hubby for his Dr. appointments. What am I going to do when I get a new job and can't take off work?


I'm nothing but a worry wart. sad


Why are you thinking about the hospital? What about another dentist or a daytime clinic? If you want to stick with office management you have experience and beaucoup dental experience.

I'm about done with dental, and I don't like any of the nearby dentists. LOL They cheat people and I'm not into that.


Also the dental offices normally don't have health insurance and now that I won't work for a dentist, I think I'll probably need some dental insurance. My 31 years of free dental work for me and my kids are over. sad

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Reply #21 posted 06/14/18 6:29am

000000

https://investor.vanguard.com/401k-rollover/?cmpgn=Ext:SM:RIG:OTH:060418:XX:POST:XX:TW:RET:XX:XX:XX:sf184666482&sf184666482=1

[Edited 6/14/18 6:38am]

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Reply #22 posted 06/14/18 8:03am

PennyPurple

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000000 said:

https://investor.vanguard.com/401k-rollover/?cmpgn=Ext:SM:RIG:OTH:060418:XX:POST:XX:TW:RET:XX:XX:XX:sf184666482&sf184666482=1

[Edited 6/14/18 6:38am]

Thank you!

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Reply #23 posted 06/15/18 6:24am

SuperFurryAnim
al

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I got a good question for funds. Ask them the % it costs and what amount of money is part of % fee (like first 250k is fee how much? 500k how much?). Mine redistribute. If one fund makes a lot and another slags eventually it will move a bit into the one struggling so I move bit parts into fund that are lower. I think it does that quarterly. Ask if they have that.

You better Watch Out! I'm a WAR MACHINE!
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Reply #24 posted 06/15/18 8:03am

PennyPurple

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SuperFurryAnimal said:

I got a good question for funds. Ask them the % it costs and what amount of money is part of % fee (like first 250k is fee how much? 500k how much?). Mine redistribute. If one fund makes a lot and another slags eventually it will move a bit into the one struggling so I move bit parts into fund that are lower. I think it does that quarterly. Ask if they have that.

Ok, thank you, I'll ask that too.

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