What are the differences and similarities between a 401K in the US and a regulated superannuation Fund in Aus?
Q. I see many questions on here regarding 401K's which i assume are available in the United States. They sound quite similar to Regulated Complying Superannuation Funds in Australia. I have worked in the Superannuation industry in Australia so I understand in detail how Australian super funds work and the rules relating to them. I am specifically looking for information on how a 401K works and, if anybody knows about both superannuation funds and 401K's, what the similarities/differences are. If you only know about 401K's then please put down what you know and I will be able to work out the differences and similarities. My understanding is that 401K's are retirement savings accounts which are preserved until age 62 except in certain… [cont.]
Asked by Richard D - Tue Jan 30 08:11:14 2007 - - 2 Answers - 0 Comments
A. Since I spend time in both countries during each year, I can give your info, but from a layman's point of view. The 401 Ks are similar to super funds. The differences are that in the 401K 1) It is not compulsory for employers to contribute. It is also not compulsory for employees to contribute, although they have to realize that their retirement is their own responsibility. 2) Many employers only match the contribution that their employee puts aside, in many cases up to 6% to 10% of the employee's base income. 2) Insurance is only available at the employees expense and if the employee chooses to insure his/her income. 3) 401Ks are sort of like a form of savings. You contribute funds into your 401K account, sort of like dollar… [cont.]
Answered by Muga Wa Kabbz - Tue Jan 30 08:46:52 2007
Q. I see many questions on here regarding 401K's which i assume are available in the United States. They sound quite similar to Regulated Complying Superannuation Funds in Australia. I have worked in the Superannuation industry in Australia so I understand in detail how Australian super funds work and the rules relating to them. I am specifically looking for information on how a 401K works and, if anybody knows about both superannuation funds and 401K's, what the similarities/differences are. If you only know about 401K's then please put down what you know and I will be able to work out the differences and similarities. My understanding is that 401K's are retirement savings accounts which are preserved until age 62 except in certain… [cont.]
Asked by Richard D - Tue Jan 30 08:11:14 2007 - - 2 Answers - 0 Comments
A. Since I spend time in both countries during each year, I can give your info, but from a layman's point of view. The 401 Ks are similar to super funds. The differences are that in the 401K 1) It is not compulsory for employers to contribute. It is also not compulsory for employees to contribute, although they have to realize that their retirement is their own responsibility. 2) Many employers only match the contribution that their employee puts aside, in many cases up to 6% to 10% of the employee's base income. 2) Insurance is only available at the employees expense and if the employee chooses to insure his/her income. 3) 401Ks are sort of like a form of savings. You contribute funds into your 401K account, sort of like dollar… [cont.]
Answered by Muga Wa Kabbz - Tue Jan 30 08:46:52 2007
401K limit applies if I changed jobs during the calendar year?
Q. I have recently changed jobs and would like to know if the annual limit still applies to my 401K. For example, year to date I've contributed $10K to my previous employer's 401K plan. Does this mea my 401K contribution for the year with the new employer should be less than 5.5K? Thanks!
Asked by SHH - Mon Aug 25 20:44:44 2008 - - 2 Answers - 1 Comments
A. Yes, and you will have to keep an eye on it as your new employer will not know what you have done during the year at your previous job.
Answered by Sharon T - Mon Aug 25 21:01:40 2008
Q. I have recently changed jobs and would like to know if the annual limit still applies to my 401K. For example, year to date I've contributed $10K to my previous employer's 401K plan. Does this mea my 401K contribution for the year with the new employer should be less than 5.5K? Thanks!
Asked by SHH - Mon Aug 25 20:44:44 2008 - - 2 Answers - 1 Comments
A. Yes, and you will have to keep an eye on it as your new employer will not know what you have done during the year at your previous job.
Answered by Sharon T - Mon Aug 25 21:01:40 2008
Generally speaking, do most 401k plans allow the participant to invest in individual stocks?
Q. And by individual stocks, I don't mean the company's stock. I'm talking about non-employer stocks traded on an exchange. In addition, do most 401k plans allow the participant invest in any mutual fund of his/her choice? Or do most 401k plans offer only a limited mutual fund selection? *I know plans vary. But, this is just a general question.
Asked by Yay Ah! - Sat Dec 5 16:38:55 2009 - - 5 Answers - 0 Comments
A. No, it's not always investing in stocks. It all depends on what your company offers.
Answered by Max M - Tue Dec 8 17:51:00 2009
Q. And by individual stocks, I don't mean the company's stock. I'm talking about non-employer stocks traded on an exchange. In addition, do most 401k plans allow the participant invest in any mutual fund of his/her choice? Or do most 401k plans offer only a limited mutual fund selection? *I know plans vary. But, this is just a general question.
Asked by Yay Ah! - Sat Dec 5 16:38:55 2009 - - 5 Answers - 0 Comments
A. No, it's not always investing in stocks. It all depends on what your company offers.
Answered by Max M - Tue Dec 8 17:51:00 2009
How is the 401k loan interest compounded?
Q. I want to understand if the 401k loan interest schedule is different from a mortgage interest schedule. For example, in a mortgage payment the interest is the most of it. Is it the same with 401k loan? Reason for asking is to see if it makes financial sense to use 401k loan to pay off a mortgage on a property. Thanks!
Asked by mishatim - Mon Jul 2 14:37:20 2007 - - 0 Answers - 0 Comments
A. The 401K interest is paid back to yourself rather than to a bank. So no matter how it is calculated, the money is yours no matter what. However, paying off a mortgage with a loan from your 401k is most certainly a bad idea. The interest on your mortgage is tax deductible. If your interest rate is 7%, in reality you're only paying around 5% after the tax advantage. On the other hand, the official interest on your 401k is irrelevant (because you pay it to yourself)... but the real cost of borrowing from your 401k is that your money is not earning the interest that it could be if invested. You should be making between 8% and 11% average in your 401k if it's invested properly. (8% if you're nearing retirement, 11% if you're more than… [cont.]
Answered by cuztis209 - Mon Jul 2 21:31:24 2007
Q. I want to understand if the 401k loan interest schedule is different from a mortgage interest schedule. For example, in a mortgage payment the interest is the most of it. Is it the same with 401k loan? Reason for asking is to see if it makes financial sense to use 401k loan to pay off a mortgage on a property. Thanks!
Asked by mishatim - Mon Jul 2 14:37:20 2007 - - 0 Answers - 0 Comments
A. The 401K interest is paid back to yourself rather than to a bank. So no matter how it is calculated, the money is yours no matter what. However, paying off a mortgage with a loan from your 401k is most certainly a bad idea. The interest on your mortgage is tax deductible. If your interest rate is 7%, in reality you're only paying around 5% after the tax advantage. On the other hand, the official interest on your 401k is irrelevant (because you pay it to yourself)... but the real cost of borrowing from your 401k is that your money is not earning the interest that it could be if invested. You should be making between 8% and 11% average in your 401k if it's invested properly. (8% if you're nearing retirement, 11% if you're more than… [cont.]
Answered by cuztis209 - Mon Jul 2 21:31:24 2007
Is there a max amount you can contribute to 2 seperate 401k accounts if you are married filing joinly?
Q. My wife's company just added a 401k and I am considering contributing to it but was wondering if there are limits to max 401k contributions if we file married/jointly? I currently max out my 401k account and I know with our combined income status IRA contributions are no longer tax deductible so I am worried adding to her 401k will bring the same limitation.
Asked by Bryan C - Thu Apr 17 11:05:22 2008 - - 5 Answers - 0 Comments
A. Both you and your wife can each contribute up to $15,500 to your respective employer 401(k) plans, assuming that these are the only employer retirement plans you participate in during the year. She can contribute up to $15,500 to her 401(k) and you can still contribute up to $15,500 to your 401(k) plan. If either of you will be age 50 or over by the end of the year, you may also be eligible to make a $5,000 catch-up contribution to either or both plans. Check with your employer plan to be sure they allow catch-up contributions if you would like to contribute the additional amount and are old enough to do so. There is often an employer matching contribution available for employees who contribute to the employer 401(k) plan. If your wife' [cont.]
Answered by The Tax Institute at H&R Block - Thu Apr 17 12:09:35 2008
Q. My wife's company just added a 401k and I am considering contributing to it but was wondering if there are limits to max 401k contributions if we file married/jointly? I currently max out my 401k account and I know with our combined income status IRA contributions are no longer tax deductible so I am worried adding to her 401k will bring the same limitation.
Asked by Bryan C - Thu Apr 17 11:05:22 2008 - - 5 Answers - 0 Comments
A. Both you and your wife can each contribute up to $15,500 to your respective employer 401(k) plans, assuming that these are the only employer retirement plans you participate in during the year. She can contribute up to $15,500 to her 401(k) and you can still contribute up to $15,500 to your 401(k) plan. If either of you will be age 50 or over by the end of the year, you may also be eligible to make a $5,000 catch-up contribution to either or both plans. Check with your employer plan to be sure they allow catch-up contributions if you would like to contribute the additional amount and are old enough to do so. There is often an employer matching contribution available for employees who contribute to the employer 401(k) plan. If your wife' [cont.]
Answered by The Tax Institute at H&R Block - Thu Apr 17 12:09:35 2008
How about a single 401k that is part of a sole proprietor business?
Q. Where do contributions for either the deductible portion or the 401k Roth portion get reported? Is there a place on the schedule C or somewhere else?
Asked by TheProfessor - Fri Oct 12 09:37:22 2007 - - 3 Answers - 0 Comments
A. Your deductible contributions go on the 1040 Line 28, not on Schedule C. Details are in IRS Pub 560 You may also be required to file Form 5500 or form 5500-EZ as a separate information return when your accumulation gets over $250,000.
Answered by ninasgramma - Fri Oct 12 14:33:27 2007
Q. Where do contributions for either the deductible portion or the 401k Roth portion get reported? Is there a place on the schedule C or somewhere else?
Asked by TheProfessor - Fri Oct 12 09:37:22 2007 - - 3 Answers - 0 Comments
A. Your deductible contributions go on the 1040 Line 28, not on Schedule C. Details are in IRS Pub 560 You may also be required to file Form 5500 or form 5500-EZ as a separate information return when your accumulation gets over $250,000.
Answered by ninasgramma - Fri Oct 12 14:33:27 2007
Any way to use 401k to help pay for grad school?
Q. My husband is starting business school in the fall. I completed his FAFSA and our expected personal contribution is $53k per year (yikes!). He has a considerable amount saved in his 401k account and since we are both young it might make sense to use that 401k retirement $ towards school expenses. Is there any way to do this without incurring huge penalties? I know we would pay taxes on the amount in the 401k, but if we are using it for education expenses it seems like there might be some way to use the money without paying the penalty... Does anyone know of a good way to do this?
Asked by mcrevell80 - Tue Feb 27 09:36:02 2007 - - 4 Answers - 0 Comments
A. way better off iwth student loan...interest rate is lower AND partially deductible. Further, the time period is extended out. A 401k loan is payable in only 5 years. Hefty payments to make while he's in grad school. At least the student loan payments don't start until you graduate. Do not take a distribution from your 401k for this...that 50k that you'll need will end up costing your retirement account about 500k. AND that's not including the penalty.
Answered by digdowndeepnseattle - Tue Feb 27 11:58:12 2007
Q. My husband is starting business school in the fall. I completed his FAFSA and our expected personal contribution is $53k per year (yikes!). He has a considerable amount saved in his 401k account and since we are both young it might make sense to use that 401k retirement $ towards school expenses. Is there any way to do this without incurring huge penalties? I know we would pay taxes on the amount in the 401k, but if we are using it for education expenses it seems like there might be some way to use the money without paying the penalty... Does anyone know of a good way to do this?
Asked by mcrevell80 - Tue Feb 27 09:36:02 2007 - - 4 Answers - 0 Comments
A. way better off iwth student loan...interest rate is lower AND partially deductible. Further, the time period is extended out. A 401k loan is payable in only 5 years. Hefty payments to make while he's in grad school. At least the student loan payments don't start until you graduate. Do not take a distribution from your 401k for this...that 50k that you'll need will end up costing your retirement account about 500k. AND that's not including the penalty.
Answered by digdowndeepnseattle - Tue Feb 27 11:58:12 2007
What is the maximum I can contribute to 401k?
Q. In tax year 2006, Since I am over 50 years old, I contributed $5,000 to a traditional IRA because I wanted to reduce my taxable income. My 401k contributions brought my income just a little over $50,000 so I was able to reduce my income by most of $5,000. Is there a limiy as to how much I can have my employer deposit into my 401k account? My income will increase a little and want to be able to contribute more so that my 2007 taxes can be reduced by a $5,000 traditional IRA contribution.
Asked by wizeman - Sun Apr 15 23:01:00 2007 - - 4 Answers - 1 Comments
A. Since you are covered by a qualified retirement plan at work and have income of over $50k, not all of the IRA contribution is deductible if you are a single taxpayer. If your gross income exceeded $60k, none of it was deductible. The maximum 401(k) contribution is the lesser of the amount your employer allows or the government guidelines -- $15,000 for 2006 and indexed for inflation for 2007 and later years. An employer match of up to 6% of your pre-tax salary is permitted above those amounts but again is NOT mandatory. (The law also provides for catch-up contributions for over-50s but your employer does NOT have to allow those contributions)
Answered by Bostonian In MO - Sun Apr 15 23:11:38 2007
Q. In tax year 2006, Since I am over 50 years old, I contributed $5,000 to a traditional IRA because I wanted to reduce my taxable income. My 401k contributions brought my income just a little over $50,000 so I was able to reduce my income by most of $5,000. Is there a limiy as to how much I can have my employer deposit into my 401k account? My income will increase a little and want to be able to contribute more so that my 2007 taxes can be reduced by a $5,000 traditional IRA contribution.
Asked by wizeman - Sun Apr 15 23:01:00 2007 - - 4 Answers - 1 Comments
A. Since you are covered by a qualified retirement plan at work and have income of over $50k, not all of the IRA contribution is deductible if you are a single taxpayer. If your gross income exceeded $60k, none of it was deductible. The maximum 401(k) contribution is the lesser of the amount your employer allows or the government guidelines -- $15,000 for 2006 and indexed for inflation for 2007 and later years. An employer match of up to 6% of your pre-tax salary is permitted above those amounts but again is NOT mandatory. (The law also provides for catch-up contributions for over-50s but your employer does NOT have to allow those contributions)
Answered by Bostonian In MO - Sun Apr 15 23:11:38 2007
What is the difference between 401k earning and appreciation?
Q. When looking at my 401k statement, there is an "Earnings" section and a "Appreciation/Depreciatio n" section. What is the difference?
Asked by Matthew F - Wed Sep 17 18:19:08 2008 - - 2 Answers - 0 Comments
A. Add Capital Gains to the earnings section in Jeff's response. Also Appreciation/Depreciation should also include realized gains as well.
Answered by digdowndeepnseattle - Thu Sep 18 10:04:00 2008
Q. When looking at my 401k statement, there is an "Earnings" section and a "Appreciation/Depreciatio n" section. What is the difference?
Asked by Matthew F - Wed Sep 17 18:19:08 2008 - - 2 Answers - 0 Comments
A. Add Capital Gains to the earnings section in Jeff's response. Also Appreciation/Depreciation should also include realized gains as well.
Answered by digdowndeepnseattle - Thu Sep 18 10:04:00 2008
How long to recieve a 401k cash out check?
Q. I recently switched companies & I am cashing out my 401k. Its done, so I don't want to hear about it being a bad decision. I am just curoius how long to expect to wait for the check. Can it be direct depoited? Would that speed it up? Does anyone have experience with this?
Asked by ange - Thu Mar 13 23:48:31 2008 - - 1 Answers - 0 Comments
A. It usually comes in the form of a check within a couple weeks. If you change your mind, you can still roll the funds into a 401k without penalty if you directly deposit the check.
Answered by Ryan - Mon Mar 17 23:16:24 2008
Q. I recently switched companies & I am cashing out my 401k. Its done, so I don't want to hear about it being a bad decision. I am just curoius how long to expect to wait for the check. Can it be direct depoited? Would that speed it up? Does anyone have experience with this?
Asked by ange - Thu Mar 13 23:48:31 2008 - - 1 Answers - 0 Comments
A. It usually comes in the form of a check within a couple weeks. If you change your mind, you can still roll the funds into a 401k without penalty if you directly deposit the check.
Answered by Ryan - Mon Mar 17 23:16:24 2008
Can you cash out your 401K tax free to pay medical bills?
Q. I have to have a $25,000 surgery not covered by insurance. I'm thinking of cashing out my 401K and someone told me that you can do it tax free for medical bills. Is this true? I'm only 25 so it's not like I can't build back up my 401K...
Asked by skybelle24 - Tue Jan 16 14:45:12 2007 - - 8 Answers - 0 Comments
A. Your source may be close to the truth, if your other income isn't too high. Is the surgery deductible? Cosmetic surgery is not deductible. If you cash out your 401k for nondeductible medical expenses, you will pay income tax and a 10% penalty on the withdrawal. I assume that you will have a $25,000 withdrawal for deductible medical expenses. To the extent that your medical expenses exceed 7.5% of your adjusted gross income, that amount of the withdrawal will not be subject to the 10% penalty. So the penalty in your example is .75% of your AGI. On a $50,000 AGI, that is just $375. Not much penalty at all. The entire withdrawal figures into your AGI. But if you itemize (and you will with a medical bill this size), you will deduct… [cont.]
Answered by ninasgramma - Wed Jan 17 05:22:20 2007
Q. I have to have a $25,000 surgery not covered by insurance. I'm thinking of cashing out my 401K and someone told me that you can do it tax free for medical bills. Is this true? I'm only 25 so it's not like I can't build back up my 401K...
Asked by skybelle24 - Tue Jan 16 14:45:12 2007 - - 8 Answers - 0 Comments
A. Your source may be close to the truth, if your other income isn't too high. Is the surgery deductible? Cosmetic surgery is not deductible. If you cash out your 401k for nondeductible medical expenses, you will pay income tax and a 10% penalty on the withdrawal. I assume that you will have a $25,000 withdrawal for deductible medical expenses. To the extent that your medical expenses exceed 7.5% of your adjusted gross income, that amount of the withdrawal will not be subject to the 10% penalty. So the penalty in your example is .75% of your AGI. On a $50,000 AGI, that is just $375. Not much penalty at all. The entire withdrawal figures into your AGI. But if you itemize (and you will with a medical bill this size), you will deduct… [cont.]
Answered by ninasgramma - Wed Jan 17 05:22:20 2007
How can I move my 401k money from my employer without leaving my job?
Q. My employer does not contribute to my 401k. I want to move my money without penalty to another financial institution.
Asked by Bill K - Fri Apr 4 14:58:11 2008 - - 4 Answers - 0 Comments
A. You really cannot move it without taxes/penalties.
Answered by God is Good! - Fri Apr 4 15:01:23 2008
Q. My employer does not contribute to my 401k. I want to move my money without penalty to another financial institution.
Asked by Bill K - Fri Apr 4 14:58:11 2008 - - 4 Answers - 0 Comments
A. You really cannot move it without taxes/penalties.
Answered by God is Good! - Fri Apr 4 15:01:23 2008
How old must you be to enroll in a 401k within your company?
Q. Hi all! My son's girlfriend is only 19 and her company has a 401k program. She was told that she can not contribute until she is 21. They live in Illinois. Does anyone know if there are age restrictions on beginning a 401K? Thanks in advance for your answers!
Asked by zonagal43 - Tue Oct 21 13:55:32 2008 - - 7 Answers - 0 Comments
A. The statutory eligiblty set by the IRS for 401(k) plans is 1 year of service (defined as working more than 1000 hours) and age 21. The plan must also provide two entry dates, one at the the beginning of the plan year or six months following the completion of the requirements . From there companies can pick their own eligiblity requirements, as long as it does not exceed the IRS statutory.
Answered by Emo - Wed Oct 22 15:36:10 2008
Q. Hi all! My son's girlfriend is only 19 and her company has a 401k program. She was told that she can not contribute until she is 21. They live in Illinois. Does anyone know if there are age restrictions on beginning a 401K? Thanks in advance for your answers!
Asked by zonagal43 - Tue Oct 21 13:55:32 2008 - - 7 Answers - 0 Comments
A. The statutory eligiblty set by the IRS for 401(k) plans is 1 year of service (defined as working more than 1000 hours) and age 21. The plan must also provide two entry dates, one at the the beginning of the plan year or six months following the completion of the requirements . From there companies can pick their own eligiblity requirements, as long as it does not exceed the IRS statutory.
Answered by Emo - Wed Oct 22 15:36:10 2008
How much is taxed when you take money out of your 401k?
Q. I recently got divorced. I have to sign over 1/2 of my 401k to her. I am thinking of asking her to buy her out less any taxes she would have been charged. What percentage is taken out of a 401k when removed. I am trying to think of an offer to give her. The 401k is not alot. (24,000) She gets 12k. Any Ideas?
Asked by kydadoflouisville - Tue Aug 8 10:25:30 2006 - - 6 Answers - 0 Comments
A. Before I give advice, I was wondering if you have a QDRO (qualified domestic relations order) in place. If so, you may already have some protection from tax implications on this. Check with your attorney to see if he set up the QDRO. Also, it seems to me that it could be possible to handle this an entirely different way. Since the main idea is to divide your assets in half, couldn't the decree have been set up such that you would retain 100% interest in the 401(k) and she would receive cash? It seems like kind of sloppy planning to have either of you end up with tax implications from this. Some states have certain laws that preclude this sort of thing, but check with your attorney to see if it's too late for the QDRO or dividing the assets… [cont.]
Answered by SuzeY - Tue Aug 8 23:01:43 2006
Q. I recently got divorced. I have to sign over 1/2 of my 401k to her. I am thinking of asking her to buy her out less any taxes she would have been charged. What percentage is taken out of a 401k when removed. I am trying to think of an offer to give her. The 401k is not alot. (24,000) She gets 12k. Any Ideas?
Asked by kydadoflouisville - Tue Aug 8 10:25:30 2006 - - 6 Answers - 0 Comments
A. Before I give advice, I was wondering if you have a QDRO (qualified domestic relations order) in place. If so, you may already have some protection from tax implications on this. Check with your attorney to see if he set up the QDRO. Also, it seems to me that it could be possible to handle this an entirely different way. Since the main idea is to divide your assets in half, couldn't the decree have been set up such that you would retain 100% interest in the 401(k) and she would receive cash? It seems like kind of sloppy planning to have either of you end up with tax implications from this. Some states have certain laws that preclude this sort of thing, but check with your attorney to see if it's too late for the QDRO or dividing the assets… [cont.]
Answered by SuzeY - Tue Aug 8 23:01:43 2006
Should I start 401K with a recession around the corner?
Q. I recently become eligible to join 401K through my work for the first time. With a recession possibly looming around the corner and the Market not performing very well right now, what should I do? Should I go ahead and join and take advantage of the lower prices and shares or should I wait it out until the Market starts to perform better? Just to note I have never been a part of a 401K plan before now. Any help would be appreciated. Thanks.
Asked by CoCoN - Mon Jan 21 16:15:38 2008 - - 7 Answers - 0 Comments
A. You absolutely should. A 401(k) is a life-long investment, so you shouldn't worry at all about the temporary ups and downs of the market. Even if this recession lasts 5 years, just think of it as an opportunity to buy while stocks are low. Assuming you've got a long way to retirement and you're investing a portion of each paycheck, you'll be doing what's called "long term dollar-cost averaging" which is a proven mechanism for generating lots of wealth. Happy savings!
Answered by Tom V - Mon Jan 21 16:25:02 2008
Q. I recently become eligible to join 401K through my work for the first time. With a recession possibly looming around the corner and the Market not performing very well right now, what should I do? Should I go ahead and join and take advantage of the lower prices and shares or should I wait it out until the Market starts to perform better? Just to note I have never been a part of a 401K plan before now. Any help would be appreciated. Thanks.
Asked by CoCoN - Mon Jan 21 16:15:38 2008 - - 7 Answers - 0 Comments
A. You absolutely should. A 401(k) is a life-long investment, so you shouldn't worry at all about the temporary ups and downs of the market. Even if this recession lasts 5 years, just think of it as an opportunity to buy while stocks are low. Assuming you've got a long way to retirement and you're investing a portion of each paycheck, you'll be doing what's called "long term dollar-cost averaging" which is a proven mechanism for generating lots of wealth. Happy savings!
Answered by Tom V - Mon Jan 21 16:25:02 2008
What do I do with a 401k from a job I'm leaving to go back to school?
Q. I'm already planning on opening an IRA at the maximum amount. So what do I do with my 401k if I'm leaving my job to go back to school and won't be able to roll it over to another employers plan?
Asked by Donkeyshane - Thu Jun 12 14:53:38 2008 - - 9 Answers - 0 Comments
A. Roll it over to a traditional IRA. It doesn't matter how much money you have in your 401k you can alway move it to an IRA, and still max-out you IRA. Never roll money over to another employers plan. Legally the money in your employer's retirement plan for as long as it stays in their retirement plan is their money not yours, and they are allowed take that money without your authorization (although very unlikely to happen).
Answered by Rigo C - Thu Jun 12 15:14:16 2008
Q. I'm already planning on opening an IRA at the maximum amount. So what do I do with my 401k if I'm leaving my job to go back to school and won't be able to roll it over to another employers plan?
Asked by Donkeyshane - Thu Jun 12 14:53:38 2008 - - 9 Answers - 0 Comments
A. Roll it over to a traditional IRA. It doesn't matter how much money you have in your 401k you can alway move it to an IRA, and still max-out you IRA. Never roll money over to another employers plan. Legally the money in your employer's retirement plan for as long as it stays in their retirement plan is their money not yours, and they are allowed take that money without your authorization (although very unlikely to happen).
Answered by Rigo C - Thu Jun 12 15:14:16 2008
I have a 401K that is vested. I plan to go to India and cash it. How to do without paying much penalty and tax
Q. I have a 401K that is vested for around 1000 US$ and I am allowed to take it after I leave the employer. I do plan to go back to India. Is it possible to take 15,000 $ per year and avoid paying federal and state taxes ( Since Iam out of country and not a resident + it falls with less income per annum). Is there a penalty that I have to pay while taking money out. I will have closed all my bank accounts except this IRA/401K account and so how would I pay the penalty and any taxes that might occur. Please advice.
Asked by Bala Gopalakrishnan - Fri Apr 13 13:35:54 2007 - - 3 Answers - 0 Comments
A. The others hit it right on the 59 1/2 age thing but also since you will be out of the country the mandatory withholding goes up to 30%. Yes, by minimizing the distribution amount you can lower your tax but you'll still need to file US returns to get that extra money back. If you don't live in the states you won't have any state tax.
Answered by digdowndeepnseattle - Tue Apr 17 10:54:04 2007
Q. I have a 401K that is vested for around 1000 US$ and I am allowed to take it after I leave the employer. I do plan to go back to India. Is it possible to take 15,000 $ per year and avoid paying federal and state taxes ( Since Iam out of country and not a resident + it falls with less income per annum). Is there a penalty that I have to pay while taking money out. I will have closed all my bank accounts except this IRA/401K account and so how would I pay the penalty and any taxes that might occur. Please advice.
Asked by Bala Gopalakrishnan - Fri Apr 13 13:35:54 2007 - - 3 Answers - 0 Comments
A. The others hit it right on the 59 1/2 age thing but also since you will be out of the country the mandatory withholding goes up to 30%. Yes, by minimizing the distribution amount you can lower your tax but you'll still need to file US returns to get that extra money back. If you don't live in the states you won't have any state tax.
Answered by digdowndeepnseattle - Tue Apr 17 10:54:04 2007
How do you explain 401K benefits to employees so that it increases participation?
Q. Explain 401K benefits in a way that reached the audience, is easy tof them to understand and emphasize the advantages of a 401K. How can you explain this benefit during employee orientation so that it results in high participation, less confusion and fewer phone calls for clarification.
Asked by Tauhric B - Sun Dec 10 12:31:14 2006 - - 3 Answers - 0 Comments
A. At any company I have worked for this is provided by the 401k administrator. They usually have meetings each year with any interested employee. (this may be law) You are legally bound NOT to influence employee's decisions. Yes, 401k's are great asset, but your not the one to tell your employee's. The only thing an employer can do is offer better "matching funds", but again...NO persuasion. You should check the IRS rules for employers regarding 401K. 401K is named for the IRS code that regulates them.
Answered by Mike M. - Sun Dec 10 12:40:34 2006
Q. Explain 401K benefits in a way that reached the audience, is easy tof them to understand and emphasize the advantages of a 401K. How can you explain this benefit during employee orientation so that it results in high participation, less confusion and fewer phone calls for clarification.
Asked by Tauhric B - Sun Dec 10 12:31:14 2006 - - 3 Answers - 0 Comments
A. At any company I have worked for this is provided by the 401k administrator. They usually have meetings each year with any interested employee. (this may be law) You are legally bound NOT to influence employee's decisions. Yes, 401k's are great asset, but your not the one to tell your employee's. The only thing an employer can do is offer better "matching funds", but again...NO persuasion. You should check the IRS rules for employers regarding 401K. 401K is named for the IRS code that regulates them.
Answered by Mike M. - Sun Dec 10 12:40:34 2006
How do you take out an early 401k withdrawal?
Q. I see all over the internet people mentioning cashing in their 401k early to pay off debt. I just tried to do that exact same thing, yet according to my representative, (who put me on hold to verify with someone else) there is not one single legal way I can cash in my 401k early without qualifying for a Hardship Withdrawal and providing proof from a very limited list of acceptable documents for them to investigate. Which is the truth here: Have people closed out their 401k early to pay off debt, or is there no legal way to do so?
Asked by Jen - Tue Sep 4 11:12:48 2007 - - 7 Answers - 0 Comments
A. Are these people cashing in their 401k early, people who are older and retired? As Plea_of_insanity states, there is no legal way to withdraw from your plan (while still employed) unless you qualify for the Hardship withdrawal or take a loan on your 401k. BTW Plea_of_insanity, you tricky tricky man. Asking questions you already know the answer to! Tsk Tsk! ;P I wondered why you looked familiar...
Answered by www.ocbeautybeat.blogspot.com - Tue Sep 4 14:07:13 2007
Q. I see all over the internet people mentioning cashing in their 401k early to pay off debt. I just tried to do that exact same thing, yet according to my representative, (who put me on hold to verify with someone else) there is not one single legal way I can cash in my 401k early without qualifying for a Hardship Withdrawal and providing proof from a very limited list of acceptable documents for them to investigate. Which is the truth here: Have people closed out their 401k early to pay off debt, or is there no legal way to do so?
Asked by Jen - Tue Sep 4 11:12:48 2007 - - 7 Answers - 0 Comments
A. Are these people cashing in their 401k early, people who are older and retired? As Plea_of_insanity states, there is no legal way to withdraw from your plan (while still employed) unless you qualify for the Hardship withdrawal or take a loan on your 401k. BTW Plea_of_insanity, you tricky tricky man. Asking questions you already know the answer to! Tsk Tsk! ;P I wondered why you looked familiar...
Answered by www.ocbeautybeat.blogspot.com - Tue Sep 4 14:07:13 2007
Does a 401K beneficiary have to live in the US?
Q. I want to add someone as a beneficiary to my 401K, who lives in Germany. I can't find any regulations on this. Does anyone know if it's possible to select a beneficiary outside the US?
Asked by lainey - Tue Mar 6 10:39:05 2007 - - 3 Answers - 0 Comments
A. It's possible. Though if they aren't residents of the US the tax withholding will be 30% when you pay it out and not 20%.
Answered by digdowndeepnseattle - Wed Mar 7 10:52:38 2007
Q. I want to add someone as a beneficiary to my 401K, who lives in Germany. I can't find any regulations on this. Does anyone know if it's possible to select a beneficiary outside the US?
Asked by lainey - Tue Mar 6 10:39:05 2007 - - 3 Answers - 0 Comments
A. It's possible. Though if they aren't residents of the US the tax withholding will be 30% when you pay it out and not 20%.
Answered by digdowndeepnseattle - Wed Mar 7 10:52:38 2007
From Yahoo Answer Search: '401k'
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The award recognizes the specific accomplishments by a leading financial advisor in the 401(k ) marketplace. Sponsored by Morningstar, Inc., ...
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here here here the historical performance of active mutual fund management does not justify the fees they charge us We are hard at work on new functionality that we hope will help address some of these issues We can t wait to show them to you and get your reaction Related Posts
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Mako
Sun, 07 Mar 2010 14:56:55 GM
But I've definitely learned a great deal about investing since I first got my . 401(K. ) in 2006: I need to stop trying to time the market. I'm better suited going to Vegas if I have a gambling addiction. I need to stop picking random funds ...
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