2006-12-18 02:53:37 · 6 answers · asked by ssnanderton 1 in Business & Finance ➔ Investing
who will give me a better rate of return banks or other financial bussiness
2006-12-18 02:57:44 · update #1
in the usa
2006-12-18 02:59:08 · update #2
this is also for retirement purposes
2006-12-18 03:01:35 · update #3
I have been in this industry for 15 years. Two things to thnk about are as follows:
1. Typically if you have more than $1,000 in the old employers 401(k) plan then they can not force you out. The money mangement fees are typically less expensive in the 401(k) versus the IRA. The reason is that employers purchase institutional shares in a 401(k) and get much better pricing. IRA's are invested in retail shares and can cost a bit more. So you may want to leave things exactly the way they currently are invested.
2. 401(k) plans are protected by ERISA act passed in 1970's. That means that they are protected against creditors or in the event of bankruptcy. IRA's do not carry this same level of protection and laws vary state by state.
Should you decide to directly roll over into an IRA then I agree that mutual funds are better invetsments for most individuals. Annuities are sold by insurance companies and most agents get compensated for selling you the annuity product.
Vanguard, Fidelity, and T. Rowe are a few mutual fund comapnies to consider. Vanguard by far has the overall lowest money management fees in the industry.
Good luck -
2006-12-18 06:08:58 · answer #1 · answered by Kirk S 2 · 0⤊ 0⤋
If you are investing for a period of over 5 years, go with a IRA - Mutual fund rather than an annuity. The annuity will charge you fees (1 -2% per year). That is on top of the fees of the investments within the annuity.
Your return, historically, will be better with mutual funds. You will still need to find good long term investments. Talk to a financial advisor.
2006-12-18 05:35:55 · answer #2 · answered by MR MONEY 3 · 0⤊ 0⤋
A rollover IRA is a far better way to invest. An annuity has all lsorts of fees and you are locked in for a lot of years unless you incur still more fees.
If you are not a savvy investor, go to http://www.vanguard.com . They offer low-fee options in all areas.
I prefer exchange traded funds, but you need to be more knowlegeable about the market than if you use a Vanguard balanced fund.
for some tax information: http://wwwtaxman.blogspot.com
2006-12-18 06:26:35 · answer #3 · answered by Anonymous · 0⤊ 0⤋
if you have money in a retirement plan where you work, like in a 401k and you leave the company and you want to do what is called a rollover, this means you are just going to move it out of that 401k account to your own IRA account. you should just do this straight to an IRA. you could roll this money over to an annuity IRA if you want, but it would cost you more money. annuities have high yearly costs compared to mutual fund ira's. you don't ever want this money in your hands, just roll it over directly to your mutual fund company. call vanguard they can help you complete the paperwork.
2006-12-18 03:01:42 · answer #4 · answered by besthusbandever 4 · 1⤊ 0⤋
Annuities are a bad investment for most people. Typically financial salesmen make large commissions selling these products and they have high reoccurring expenses. You would be better off investing in low cost Vanguard mutual funds. Go to Vanguard.com for more information.
2006-12-18 03:03:11 · answer #5 · answered by John P 1 · 2⤊ 0⤋
Neither, I suggest CD you deposit 1,000 once matured you take out 10,000.
2006-12-18 02:56:05 · answer #6 · answered by Juleette 6 · 0⤊ 2⤋