401K Financial Planning

Nick asked:

I have been trading using stock simulation software for a while to learn about the stock market. I have few questions regarding the real stock market. I have total of 5 questions, i am posting 2 here, rest in a different thread. Big thanks in advance for the help. Please help
1) Sometimes my simulator won’t let me buy big volumes of certain stocks (for e.g.: yesterday I tried to buy 2000 of McDonald’s stock and did not let me, I had to reduce that to 500). Does it happen in real time where you cannot buy so many because there is not enough in the market?

2) How much time does it take to process a stock order, buy and sell? If it only takes few seconds and I knew a stock is going up, couldn’t I buy some and sell before the trend falls? I am also thinking someone can short a stock while trending down. (Provided the discount broker gives real time stock price)
I cannot test any of the above using my simulator because it takes 20 minutes to process an order.


Question posted courtesy of: Marcus

mkb_2700 asked:

What is a Mutual Fund?

The idea behind a mutual fund is simple: Many people pool their money in a fund, which invests in various securities. Each investor shares proportionately in the fund’s investment returns — the income (dividends or interest) paid on the securities and any capital gains or losses caused by sales of securities the fund holds.

Every mutual fund has a manager, also called an investment adviser, who directs the fund’s investments according to the fund’s objective, such as long-term growth, high current income, or stability of principal. Depending on its objective, a fund may invest in stocks, bonds, cash investments, or a combination of these financial assets.
Please answer.


Question posted courtesy of: Geraldine

Lola Belle asked:

I am only 25 currently and I was wondering about some suggestions for investing for the short term (5-10 years) and for retirement. I really want to start up a photography business within the next year to year and a half and was wanting some quick investing tips for getting a jump start on it. I could put about $200-$400 a month away in investments right now. In 6 months that may change with my job (possibly more in about 6 months, raise time ). We already invest in a Roth IRA right now. Wanting to invest more for the future. Tips and Tricks greatly appreciated.


Question posted courtesy of: Clyde

gonejetskiing asked:

I have a 401K with a company I worked for 13 yrs and it “downsized” and closed its factory production where I was. I got a call from the financial company that handle the 401K and they want me to get my money out of that 401k since I dont work there anymore. I think that by law I do not have to move it but I heard that I could roll it to a Roth IRA and that I can take money out of that Roth to invest in the stock market etc etc?? Is this correct????? I have to call back these guys and find out what they suggest but dont want to get screwed just cause my former boss doesnt want to pay to have me in his companys 401k. Any correct info is appreciated…Thanks!


Question posted courtesy of: Sylvia

burkmere asked:

I have gotten into some credit card debt by thinking I could use some credit (interest free that later turned into higher interest credit), time the market, and then pay off the debt…it didn’t turn out that well and instead my credit balance increased and I feel I should pay it off.

Iwill receive a public sector pension when I retire in a few years, so I’m not “all” that concerned about my deferred comp. balances at the moment, so I feel I should borrow from my 401k plan (my public sector oranization will allow me to borrow up to half my balance in my 401k from myself) and pay off my credit card debt…

I feel this would be better that withdrawing the money from my 401k ( I know I must pay tax and a penalty if I do this)….

Does my plan of borrowing from my 401k to pay off my credit card make sense, and if so, does it make more sense than just withdrawing the required amount of money from my 401k to pay off my credit card debt…??


Question posted courtesy of: Frances

cooldude43201 asked:

I’m in process to change my job. I’ve 20K in my 401K account. I heard that I can rollover 401K to my IRA account and then withdraw $10K for the house payment to avoid 10% penalty. I already bought my first house 18 months ago.

My second question is if I have to pay the penalty fee is it advisable to borrow money from 401K now. My new job salary is ~20K higher than my last job.

I’m 29 years old and live in ohio.


Question posted courtesy of: Annie

jcvermont asked:

I rolled over a 401k from a former employer to my IRA in 2006. The 401k was a straight stock purchase plan, w/o any employer contribution. I had invested about $6000 in the plan, and when I did the rollover, the value of the 401k had gone down to around $4100 due to a drop in the company’s stock price. Is there any way to take advantage of this loss when filing my 2006 taxes?

Thanks!


Question posted courtesy of: Tanya

Viceroy of Jello asked:

Saving for a downpayment on a house. Should I hold off on 401k contributions until I buy it, or still keep contributing (I’d be able to do both)? I don’t get a match in the 401k. Also, someone told me to save in the 401k because I can take out a loan for a home purchase.


Question posted courtesy of: Colleen