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    Pension distribution

    I'm anticipating a selection to be made on a pension distribution. What are the options as far as rolling it over, financial gurus. I will have to take a look at whether ira or roth makes sense based upon the tax status, anything else to think about? It's a good chunk of money, but I'd like to take it out now while it's still there for the taking..

    I'm not ignorant on investing, however this isn't something I've considered before now.

    lump sum btw.


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    I don't do signatures. Blondes, brunettes, and red heads are a different story.

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    Re: Pension distribution

    Quote Originally Posted by simply1 View Post
    I'm ignorant on investing
    fixed it for you.

    Roll all tax advantaged accounts into an ira.

    Vanguard will help you do this.


    Last edited by kilgore_trout; 06-16-2010 at 10:19 PM.
    I was a victim of a series of accidents, as are we all.

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    Re: Pension distribution

    Quote Originally Posted by simply1 View Post
    I'm anticipating a selection to be made on a pension distribution. What are the options as far as rolling it over, financial gurus. I will have to take a look at whether ira or roth makes sense based upon the tax status, anything else to think about? It's a good chunk of money, but I'd like to take it out now while it's still there for the taking..

    I'm not ignorant on investing, however this isn't something I've considered before now.

    lump sum btw.
    depends on:
    -your age
    -the stability of pension/company
    -risk
    -when you retire
    -benefit value
    -etc.

    I would strongly consider looking at what benefit will look like at retirement age, its 'growth', what benefits you may lose by rolling, etc. It isn't a simple 'roll it' answer.


    As far as depth goes though, the combination of White, Woodbury, Olaseni, Basabe, and Uthoff is much better than Niang, Ejim, Edozie, Gibson. Not because of the top 2, but because of the next 2 or 3. -DeanVogs

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    Re: Pension distribution

    I can give you my checking account #...



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    Re: Pension distribution

    Quote Originally Posted by simply1 View Post
    I'm anticipating a selection to be made on a pension distribution. What are the options as far as rolling it over, financial gurus. I will have to take a look at whether ira or roth makes sense based upon the tax status, anything else to think about? It's a good chunk of money, but I'd like to take it out now while it's still there for the taking..

    I'm not ignorant on investing, however this isn't something I've considered before now.

    lump sum btw.
    Not sure where to start.

    What does your first sentence mean? Either you're going to qualify for a distribution due to termination, retirement, disability, or the plan is terminating or not.

    I believe it is safe to say your options for rollover are either to a traditional IRA or rollover (actually convert) to a Roth IRA. This is really a tax question, not an investing question. Do you have a tax advisor? That would be a start. Otherwise, it is just a matter of researching what is best for your particular situation. You haven't provided enough here for anyone to help you make that decision for you. Tax bracket, age, other pretax investments, how close are you to retirement, etc.... are all part of the equation. One advantage of doing a rollover/conversion to a Roth IRA in 2010 (only), is that you're able to spread out the tax liability over two year (i.e...you'll pay half your taxes owned on the conversion in 2011 and the other half in 2012). NOTE: there was an article in the Wall Street Journal this past Monday entitled "“Why You Shouldn’t Convert to a Roth IRA". This is worth a read. You should be able to find this online www.wsj.com by searching by the title.

    What does your last sentence mean? "while it's still there for the taking"?

    This isn't the wild, wild, West. Pension plans are heavily regulated, so there isn't any 'first come, first serve" type of timing requirement you have to concern yourself with. Either you are entitled to a certain dollar benefit, or you are not.

    Once you have decided traditional or Roth (or keep it the plan....assuming that is an option), you'll need to decide what to invest in. Since you indicated you're not "ignorant on investing", it sounds like you have that base covered already.


    CCG

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    Re: Pension distribution

    Quote Originally Posted by capitalcityguy View Post
    Not sure where to start.

    What does your first sentence mean? Either you're going to qualify for a distribution due to termination, retirement, disability, or the plan is terminating or not.

    I believe it is safe to say your options for rollover are either to a traditional IRA or rollover (actually convert) to a Roth IRA. This is really a tax question, not an investing question. Do you have a tax advisor? That would be a start. Otherwise, it is just a matter of researching what is best for your particular situation. You haven't provided enough here for anyone to help you make that decision for you. Tax bracket, age, other pretax investments, how close are you to retirement, etc.... are all part of the equation. One advantage of doing a rollover/conversion to a Roth IRA in 2010 (only), is that you're able to spread out the tax liability over two year (i.e...you'll pay half your taxes owned on the conversion in 2011 and the other half in 2012). NOTE: there was an article in the Wall Street Journal this past Monday entitled "“Why You Shouldn’t Convert to a Roth IRA". This is worth a read. You should be able to find this online www.wsj.com by searching by the title.

    What does your last sentence mean? "while it's still there for the taking"?

    This isn't the wild, wild, West. Pension plans are heavily regulated, so there isn't any 'first come, first serve" type of timing requirement you have to concern yourself with. Either you are entitled to a certain dollar benefit, or you are not.

    Once you have decided traditional or Roth (or keep it the plan....assuming that is an option), you'll need to decide what to invest in. Since you indicated you're not "ignorant on investing", it sounds like you have that base covered already.
    unless the pension's funding is suspect and his benefit is in excess of the pbgc's thresholds...but generally speaking i agree with your post.


    As far as depth goes though, the combination of White, Woodbury, Olaseni, Basabe, and Uthoff is much better than Niang, Ejim, Edozie, Gibson. Not because of the top 2, but because of the next 2 or 3. -DeanVogs

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