I have heard of people locking up their rate at 3.99% or even 1.99% until payoff. I think they got the rate through the special offers from the credit card companies. I do not know which companies though.
You can rollover any 401k into an IRA, Roth, or Simple. If you want the money in a money market account, you can. Not the best way to go, though, IMO.
My advice is to invest $100 a month in a Roth IRA. The best bet for a novice invester is a mutual fund, which has a professional money manager making the investment decisions. The best bet for a mutual fund would be some sort of balanced fund that invested in both stocks and bonds. I suspect that if you live near a Fideilty branch office that can go in and get help there for starting up a Roth IRA with one of their mutual funds. Something to consider is trying to talk your parents into matching your monthly IRA deposit. Something else to consider is what would happen if you were not able to work for 3+ months. Do you have enough $$$ in your savings to cover your living expenses? If not, you might consider opening a companion savings account to your checking account and putting your extra money there. When you get your educaton completed and a nice paying job, you will be better situated to saving more money. 401k/403b come into play then and make excellent investment vehicles for retirement.
just because a professional runs it doesn't mean it's good. there are many professionals who are not good at what they do. most professionals are also professional salesmen. i don't not work with a fund and i am not a salesman, but i am still a licensed professional so take my word for what it's worth. which is why i say go with an index fund to start, do it yourself, and learn some stuff along the way. i think ameritrade starts you off with 30 free trades or something like that. you don't have to learn everything all at once but once you do have some money in the market you will follow things more closely and you will start to pick up stuff along the way.
Well, the bank charges annual custodial fees, but would be surprised if its more than $50 a year. But yes your IRA can be funded by securities, and they do fluctuate in value. Another surprise fee for you will be when you decide to transfer your account......
Just note if you roll the money over into a ROTH, your paying taxes. I believe you also might have to pay the 10% penalty. Remember a ROTH is contributed with post tax income, not pre tax income. Unless your self employed, I don't even think you qualify for a SIMPLE.
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Ok, I'm sure this is an extremely simple question to answer, but I'm just not that knowledgable when it comes to this stuff. I have a 401k through my work, and when I look up my progress online I have an Account Balance and a Vested Balance. Does the vested balance just indicate how much money I've contributed, and the account balance shows how much it is worth due to gains/losses of my selected funds? I also wish I had a clue which were the right funds to choose. They seem to be doing ok for me, but not great.
"vested" interest is interest you can pull away with no consequences. It's yours, no matter what the market is doing.
Actually, if your company matches, your "vested" funds are funds that belong to you and your "non vested" funds are funds that belong to your company. Your company should have a vesting schedule. It should be either "cliff" vesting (all or nothing) or "graded" vesting (a certain percentage). My company has a "cliff" vesting schedule which means that after I've been in the plan for 2 years, the company match belongs to me. Every company is different. Go to your Plan Administrator (in your HR department) and find out your company's vesting schedule.
You young people of today can expect to live to be 100, easy , provided you can pay for the medical proceedures. Paying for the gulf war and my generation's social security will bankrupt this governement, leading to hyper inflation, leading to a crash of the housing bubble that will leave you underwater on your home investment and your bonds . Anything other than the highest end white collar jobs will be outsourced or done by immigrants so the company can make it's bottom line. When the Chinese industrialize gasoline will cost $10. A nursing home stay is $36,000 a year in today's money how much will it be in 40 years when nobody dies of old age? Seriously, if you aren't on a plan to retire with several million dollars (and you better just be counting on no more than 3% real return after taxes and inflation), you might as well just insure yourself against emergencies and enjoy your life today. It could be that these are the best times you will have a chance to know. Hell, my Mom is relatively healthy and well off at 84 and hates it. All these investment plans are brought to by the same corporate minds that invented Hallmark cards at valentines and secretaries day, the illusion of scarcity in the diamond market, and bottled sugar water. The hype is to make them money. You think they run all those ads because they care about you? What don't you understand about Capitalism? Buy a big screen, a big bottle of Crown and enjoy the game! Don't miss out on your life preparing to be old. If your lucky you'll get hit by a bus.
No, I'm good. I've got some cash, good health, a woman who loves me, and blues in the headphones. Thanks for asking though.
You can not roll over a 401K directly to a ROTH IRA. It first must go to a traditional, then to ROTH. And you do pay taxes on the transaction. People normally do not do this since it could push you into another tax bracket. Think common sense here, you never paid taxes on your 401K money. You think uncle sam is going to allow you to roll it over into the Roth where once you begin to take distributions after 59 1/2 tax free? Uncle Sam gets his bucks always. Anyone tell you otherwise must be a Primerica rep
i got hired at a proprietary trading company so i had to get my series 7, 55, and 63 licenses. the series 7 is the hardest test i have ever taken...so much memorization of crap and it's a 6 hour long test. i'm really not supposed to talk about the market at all, which pretty much sucks cuz i like to talk about it. so when i do talk about it i keep it pretty generalized.
m_cable, On re-reading this thread, I realized that I was too quick to give you advise. My Bad. A very important question you need to ask yourself is what is your investment goal, ie WHY are you saving the money? Do you want to save for retirement, save for a house down payment, save for a fancy new car, save to create an emergency fund, etc. If your major financial goal is not retirement, putting your $$$ into IRAs or 401b/403b may not be the best idea since you will pay a penalty to withdraw your money before retirement (in addition to the taxes you missed out on in the first place). If your financial goals are more immendiate, you will next need to determine WHEN the money is needed. The when will help you determine an appropriate investment vehicle. As a rule of thumb, stocks have a longer time horizon than bonds. The shorter the time horizon the less risk will be taken and the lower the return will be. Given the above, this might be your best advise (at least until after you finish your eduction) ... As a final note, there is a ton of investment "advice" out there. Separating the wheat from the chaff is nontrivial and time consuming. I would recommend two books to read to get started: Making the Most of Your Money by Jane Bryant Quinn - this book will give you the big picture on managing your financial life. Asset Allocation: Balancing Financial Risk by Roger C. Gibson - this book will beat into your head the importance of diversifying your investment portfolio across several asset classes. Understanding this book will put you ahead of 90% of the field. Another good read is The Richest Man in Babylon by George S. Clason - this book stresses the importance of investment discipline, among other things.
