I have $40,000 in a a 401 k which is not getting any more contributions. I am considering a Roth IRA,what other investments could you reccommend for me?I am 44 yrs old and lost my job which had 401 K...I would like to be safe with my money ,yet make the most return I could...i just don't know whats out there after 16 years with ex employer...thanks in advance
2006-07-15 02:47:45 · 4 answers · asked by greg 1 in Business & Finance ➔ Investing
You need to roll it over into some kind of retirement account like an IRA or you will pay early withdrawal penalties, which are quite severe. If your present employer has a 401k, transfer the money directly into your new account. Otherwise, put it into an IRA with a mutual fund company like T Rowe Price or Vanguard, who will give you further advice.
With a Roth IRA you will have to pay some taxes now, but none on the withdrawals and capital gains. Look into the differences between regular and Roth IRA; again, Vanguard or T Rowe Price can advise you.
2006-07-15 04:06:52 · answer #1 · answered by Yardbird 5 · 0⤊ 0⤋
Okay. Step one-rollover the money into a Roth IRA. This should be done directly from your former employer. Under no circumstances should that check ever touch your hands, because the IRS will consider this as a distribution, not a rollover. That's a tax nightmare of epic proportions that you certainly don't want to involve yourself in. Now, the biggie, Step 2, is now that you've decided to open a Roth, where should you open it? I can't give solid financial advice, not knowing what your other investments, if any, are. The key thing you want to do is make sure that you're diversified. That said, your best bet would probably be to open the Roth with Vanguard. They are a low cost mutual fund provider and offer tons of funds. Assuming that this is your only investment, I would recommend investing maybe 75% in a broad based index fund like Vanguard's Total Stock Market Index Fund, and the other 25% in Vanguard's Total Bond Market Index Fund. Actually, there are some excellent calculators on Fidelity, Schwab and Vanguard than can help you understand your investment goals and risk tolerance, and they can give you some suggestions for allocation as well.
Good luck on the job hunt! After 16 years of experience, I'm sure there's an employer that would be thrilled to have you work for them!
2006-07-15 11:10:15 · answer #2 · answered by SuzeY 5 · 0⤊ 0⤋
put your money in ULIP's with an Famouse Insurance Company
inyour country
2006-07-15 10:52:05 · answer #3 · answered by Anonymous · 0⤊ 0⤋
Liquidify the 401K first, then contact me. I might be able to help you out, have thrust in me.
2006-07-16 04:24:34 · answer #4 · answered by mlm_sifu 2 · 0⤊ 0⤋