401K rollover

BurntOrangeOrder

BurntOrangeOrder

100+ Posts
Here's my problem: I have an old 401K account from my old firm that they want to close out. I'm not going to be able to start a new one for several months, and from what I understand, they want my money out a.s.a.p.

Question: Is there somewhere I can put the money in temporarily w/o paying any penalties? If not, what sort of penalties will I pay if they just cut me a check? Also, could I just set one up myself for independent management? Should I?

Also, on a more general level, if I some debt, and taking this money would take about a %36 chunk out of it (assuming I get all the money, which I know I won't b/c of penalties), should I just pay down my debt with it?
 
Can't you just roll it into an IRA.........like with Fidelity, or any of a number of brokerage firms?

BTW.........here's a link that I had bookmarked for some strange reason:
The Link
 
You can roll it into another IRRLwhich they will keep separate from just any IRA. The IRRL is for qualified funds from other companies. Fidelity has great funds to choose from and once you get another set up in a few months you can take it out of Fidelity and put it back into your new one.
I wouldn't suggest taking it out since the taxes will kill you.
 
It's not the taxes on the distribution that kill you - it's the 10% penalty for early withdrawal that you have to pay to Uncle Sam.
 
The answer has already been given... Move it to an IRA and leave it there. A couple of advantages: more investment options than 95% of the 401k plans out there and you can take the money (or part of it) whenver you want or need it, minus taxes and fees. Money in a 401k is pretty much stuck there unless the plan allows for loans or hardships.
 
BOO man. Im hurt that you wouldn't come to me on this. Ill be happy to lower my minimum for you and drop my fee .
wink.gif
 
Kinda weird that this topic came up, now.

I'm about to leave my company (of 9-1/2 years) and will need something to do with a shitload of cash. (I pretty much knew about the IRA option, though)
 
B/c it is time in the market not "timing" the market. By taking your money out of the market you could be missing alot of opportunities. For example over a long period of time if you missed the 10 best days in the market you would have a substantial amount less than if you had a well diversified portfolio and left it in for the long haul. The scenario gets even worse the more days that you miss. You would have also missed a day like today where the market was up over a 100 points. Plus what is fixed income paying right now 2-3%, to me it is not worth risking missing some of the good days. Also, there is no one out there that could tell me what the market may do after the elections. If it does go up, you may not be get in as soon as you want and you have already missed a huge growth opportunity, when the object of investing is to buy low and sell high, most people get in too late and then all they get is the valley and then blame it on the advisor. When they are the ones that waited.

Another thing, to be able to get a well diversified investment you can do numerous things by asset allocating your $, you can buy a bunch of different mutual funds in different asset classes(which usually takes a big chunk of cash) or you can get an asset allocated mutual fund that is allocated based on your risk tolerance. Which takes alot of work out of it, b/c it has a professional manager to buy, sell and rebalance based on your investment objective, and to this you don't have to have the big $ that it normally takes.
 
Historical events show that you should be in the market. This election is not a historical event. 9/11 was a historical event, Pearl harbor, etc...Peace of mind earning 2% is not worth it not when I just missed a day that earned 112 points. Yeah you may not lose any money staying in fixed income but you sure as hell aren't gaining anything. If the market gains 200 points before the election and goes down a 100 then I am still ahead in the end. ( Hypothetical ) If you want peace of mind for two months when you could be missing out on gains then you probably shouldn't be in the market anyway.
 
Fidelity has a great rollover IRA. I highly recommend it. You will have lots of jobs, having 1 rollover is the way to go...
 
you are not getting my point...which is that there may be something like 9/11 that would terribly disrupt the market....if there was ever a time for it to happen, it would be between now and the election....
 
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