401K Financial Planning

Valkamier asked:

I just left a company after 7 years and that was over two motnhs ago. I contacted the company that handles our 401K plan and they said they still show me as working there. When I contacted my company they said they don’t have to send out my 401K paperwork for 90 days. Is this legal? I am no longer working there and according to the 401K company, they show I am. Can I force our HR person to call them and tell them I no longer work there?


Question posted courtesy of: Adrian

Born in Bost asked:

Our company started a Roth 401K last year. For various reasons, the full contributions were lump-summed into the 401K in early January of this year. I (and some other employees) use the Schwab “Personal Choice” option that lets us have self-directed brokerage accounts.

I assumed that the Roth contribution would be put into a separate account from the pre-existing traditional 401K funds, but this is not the case - they are in the same Schwab account. Upon inquiry, our 401K administrator told us that this was the proper way to do it, and that they would “track” the Roth 401K money at the back end. This seems very awkward to me (interest on interest, transfers, dividends, commissions and so forth), but they insist this is the correct method. I found the IRS regs on Roth 401Ks, and they refer to both a “separate account” and a “separate accounting requirement.”

Is our 401K adminstrator doing this correctly?


Question posted courtesy of: Roy

goin_all_out2004 asked:

I got a letter in the mail from TransAmerica (my 401k company) that my plan has been terminated as of March 2007. This 401K is from my old job.

The letter said my old employer should send me the forms to decide what to do with the money (roll over, cash out, etc….) HOWEVER, my old employer went Bankrupt in November. It’s June and I haven’t received anything.

How can I get my money out of the 401k?


Question posted courtesy of: Raul

Eric60613 asked:

I am leaving my current employer in the next few days. Should I roll my 401K and pension fund from my soon-to-be previous employer into a traditional IRA?

My new employer offers 401K that matches up to the first 5% and allows me to roll my previous 401K into theirs. Should I do that, instead? According to the benefits literature from my new employer, my 401K with my new employer will be fully vested after my 4th anniversary there. Will I lose any value in my existing 401K by rolling mine into theirs if I leave my new employer before my 4th anniversary?


Question posted courtesy of: Cathy

Jonathan T asked:

I’ve recently become self employed and have a 401k at my old job. I just started doing research on self employed retirement plans like the SEP IRA and individual 401k. I found some good information about them here http://www.individual401k.com

From reading information about them the Individual 401k and SEP have the same limits $44,000 but with the individual 401k you might be able to contribute more at “identical income levels”. Here is a quote from their website.

“Compared to other retirement plans you may be able to make greater contributions at identical income levels, therefore maximizing retirement contributions and valuable tax deductions.”

Has anyone else set one of these retirement plans up? Should I setup a SEP IRA instead of an Individual 401k? What are the main things I should be considering when I make my decision?

Thank you for any information you can provide about the SEP IRA or Individual 401k to someone who is self employed.
JT


Question posted courtesy of: Ida

~*Stephanie S asked:

Is it a wise financial move to borrow from your 401k to pay for a home? Since the interest you pay on your 401k loan goes back into your 401k account to be invested and earn money for you, it seems to me that it’s a very wise thing to do, indeed. I wondered if maybe I’m not seeing the big picture, though?


Question posted courtesy of: Julie

Brian K asked:

I’m trying to figure out which way is the better route to go here.

I put in 10% of my income to the 401k plan at work which the company matches dollar for dollar up to 4%. I thought about dropping my 401k down to the comany match rate of 4% and use the extra money to pay off a second mortgage which is running me about 7.5 % interest. I figured I could pay it off in a little over a year if I did this.

Which is the better route? pay off early or just wait the 3 years and keep the 401k at 10%?
I paid off my car last year and I am using that extra money as well to pay off the second mortgage. It’s a 15 year loan that will be paid off in 5 years when I use my car payments. If I add the extra “401k+ money, it will be paid off next year. And I do not have a credit card bill either


Question posted courtesy of: Dorothy