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Very, very difficult right now. Now would not be a good time to have to make those decisions. It's good that you are thinking about it now, because you can see this situation unfolding in real time. Watch what inflation is doing. Watch what bonds are doing (buy bonds in this market, and you won't be able to give them away if/when inflation takes off.

This guy wrote a column in Forbes magazine for many years. He deals primarily with relatively well-off people, and he got in trouble with politically correct mafia a few years back, but his free pubs are worthwhile. .


I had two separate 401Ks with my employer when I retired. It was all in mutual funds. No brainer. Last fall, I decided to consolidate them in an IRA with a mutual fund company that I've dealt with for 50 years. I figured the market was due for a big correction. Should have left well enough alone. I'm getting slaughtered right now in this inflation, but I'll be a genius if the market goes way south and I have a few bucks to take advantage. But. I'm 76 so you see; there's another complicating factor in the equation. Can't wait around forever for the payoff.
 

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thats what I'm thinking about. we're young enough to worry about losing our butts in the market but need to keep up with inflation as we get older. jim
 

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I turn 59-1/2 next week and I'm rolling most of mine over to a fiduciary. I'm retiring at the end of August and will roll the rest over at that point.
 

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say your ready to retire and you have a 401k. Do you leave it alone, move the money to the bond type fund? move the money to a annuity type company? jim0
Hi Jim, I retired a year ago and rolled over my 401k to a self directed IRA with Edward Jones. My wife just retired from Edward Jones on April 30th after 19 years. The financial advisor has me in good, quality dividend paying stocks, mutual funds and ETF’s, my rate of return is 23.97%. I recommend an Edward Jones financial advisor after seeing a gain of almost $160k in the last year. The rate of return far outweighs the commissions charged. Now lets all buy more Chevelles!
 

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Decisions like these vary depending on individual situation and goals, just like cam lifts and duration .....lol

Not an expert here, but this is what I learned from those who are retied and search for the right answers.

1) many leave the 401K/IRA invested and apply for SS ASAP. Then pull what they need from the 401K and pay tax on $ withdrawn, and most are in low tax bracket as they are retired. If you plot the charts for early SS withdrawal vs late, you will see your breakeven point. Mine is just above 80 years old.

2) A good low cost balanced fund with a "low expense ratio" is the way to go. I like Vanguard, but Fidelity, Charles schwab etc offer these low cost funds (most re index funds). Stay away from funds with high management fees (There are tons of them out there with 1% fee or more). These funds work for the company, not us.

3) If you seek a financial professionals help, stay alert and aware so they do not park you in annuities or high management fee mutual funds, with front/back loads, 12B1 fees, etc, as many do, and you can be down 5%-10% before you earn a dime. If a financial advisor is needed, look for "fee based" firms who do not sell anything and help with asset allocation.

The fundamentals are like building cars. Make sure the machine work, parts for the given RPM range, trans and gears match, and the car runs good for a long time.

Good fortune to all

Alex
 

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When I retired I was given an option to stay with the same money manger that handled the company 401k but the expense load would be on me. I already had another financial advise relationship so I rolled mine over.
Note that you have to “roll it over” correctly. If you blow the transaction it’s a taxable event from which there is no return.
 

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say your ready to retire and you have a 401k. Do you leave it alone, move the money to the bond type fund? move the money to a annuity type company? jim0
Open a regular contributory IRA if you don't already have one and then do a rollover into it. Make sure it goes from the 401 (k) to the IRA ONLY! If you have the check sent to you, you will owe income tax on the entire amount plus a 10% penalty if you are younger than 59 and a half.

I have mine with TD Ameritrade but there are many to choose from and many are now free of commissions to buy and sell whatever you want to invest in.

Sent from my SM-N910V using Tapatalk
 

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Personally, I left one of my 401 (k)''s where it was invested in the interest bearing option. I did that so I could take a loan from my own money. I borrowed $50k at 6% and rolled that $50k into an existing contributory IRA where I control my own investments. Every month for 5 years I make a payment of $1012. that goes back into my tax deferred 401 (k). I am paying myself 6% and have the use of $50k right now. As long as I don't lose in the market, I'm getting 6% in an era of almost 0% return from most any bank or interest bearing acct.

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As stated earlier, most 401Ks are different. I left mine in a managed account and also have some in Edward Jones. The rate of return is almost the same. For me my RMD is just extra money in December. Some folks take monthly draws but each individual has different needs. A good financial advisor can help you best.
 

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Some great advice here Jim. I'll simply relate a story.

Georgia69 is also a finance mind,and what Mr Newby said is SAGE advice. We remember inflation. in 1983, I remember my Tucker Anthony RL day money market account was yielding 13%. I had put the balance of a small trust ( not rich folk, a dog ripped my face off when I was 4) in SOUTH AFRICAN GOLD shares. My uncle almost broke my head open on that one. And he was the only stock investor amongst these immigrants who were more " money in the mattress" types.

But gold ripped nice in the early 80s. It went to die later when inflation disappeared. As gold died, rates went way, way lower. 9/11 was the first reap drop, fed induced. Thefloor or foundationto a portfflon came the financial crisis. Then near deflation. Then covid.

All conspiring to rid the conservative saver of a decent GUARNATEED foundation or "floor" as i call it , to their portfolio.

UNless they own real estate. Which is ALSO something that should be included in a diversified income potfolio. Locking in 2% for any length of time is well, seems nuts.
 

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You can build a good retirement portfolio with carefully selected dividend paying stocks. The stocks can grow in value so they at least keep up with inflation and the dividends are good passive income.
 

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You can build a good retirement portfolio with carefully selected dividend paying stocks. The stocks can grow in value so they at least keep up with inflation and the dividends are good passive income.
My father before he passed had all of his portfolio in DRIP’s. He also had real estate and did well on both over his years of retirement.
He schooled me about real estate when I was young and I invested as a minor ($1000) partner in a single family home during my junior year in high school. I’ve been trading up since.
 

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Thats what I've become an "expert" in anymore. Retirement income portfolios. Pannetron is spot on. We've spoke to many of those securities here, including the "dirty" oil and gas ones, WHICH if you think about inflation may be perfect hedges.

Andy and I have here publicly fawned over our beat up pipeline Energy Transfer. She aint so beat up anymore.

Rules wise, most 401k providers are prone to want you to push the 401k into an IRA come age 72 ( new RMD age), but I;ve even seen that change. many 401k are very inexpensive platforms to hold part of your wealth, but most still do not want to be responsible once you have to take your mandatory distributions.

What they dont allow you to do in most cases , is build a diversified income portfolio using pure securities and not just funds and ETFs. Years ago, I was the asshole who asked the fund representative in a presentation at Merrill , why their " rising dividend fund" never actually bumped its dividend! The asnwer was that fees and such ate up any increases the ujderlying securities give the investor. Typicall wall street shit. So I decided that eliminating "wall street middle men" was often a good thing when seeking income and inflation-hedged income. Its a bit better now with ETFs, but not really.

And you really cannot "passively index" an income portfolio spinning a 5% yield. You have to RUN IT the old fashioned way. The unlazy do your homework way.

On the other side, I cant wait until fixed annuity rates are on pace with the rate of inflation, but me thinks I'll be waiting a LOT longer.

I ranted on both Tenneco and Permian Basin Trust last year. This year I dont see alot of cheap value bargains anymore so the portfolios are relying on some of the more traditional income equities like AGNC, NLY. I have to admit other than STAG and Simon ( SPG) I rely on Fidelity Realty Income Fund for much of our real estate exposure.

Also DIG covered call writing strategies for income, but now we;re talking really working it. Nothing passive about that. An 80+ year old client taught me that.He was doing his own actually. Too much work for any "broker".

You can be lazy about it and punt to pros by using closed end funds like John Hancock Premium Dividend fund, ( PDT) etc.

Please ALL the suggestions are HYPOTHETICAL and USED AS EXAMPLES ONLY . They may not fit your risk profile.
 

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The problem is your money is worth less every day due to inflation, especially if it sits in a low yield CD. So you take the risk with the stock market but with the administration’s spending, you know it like a car going off a cliff. Let it sit, it loses money. Invest it, it could lose a lot of money. We have some in IRA‘s and some in 401K’s, and a lot in cash. So much liquid cash that I have 3 checking accounts to benefit from FDIC. Bit that has a dwindling value every day. We are fortunate in that we have an income source that is sufficient to keep us from needing to use any funds from our investment. However, how long can we bank on that. It used to be you worked hard, saved your money, and your savings paved the way to a happy retirement. Now they reward the irresponsible idiots with perks at our expens. Socialism !
 

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say your ready to retire and you have a 401k. Do you leave it alone, move the money to the bond type fund? move the money to a annuity type company? jim0
regulators like to encourage you to leave it in the 401k but you likely have few investment options. You don't want to pull it out right away or you will have high tax consequences. If you are not sure, you need to see a professional, honest and independent investment / financial planner so he or she can gather information about your goals, needs, and other financial assets/ liabilities. Then a strategy can be developed to move the assets to an IRA (s) to give you more options, conservator, aggressive or anywhere in between. If you don't want to work with a professional (a do it yourself person), then at least move the funds to a separate IRA company like T Rowe Price or similar with a number of investment choices and use a 60% (equity) and 40% (bond or similar) allocation to start to see how it goes for awhile. Good luck and congratulations on your retirement.
 

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At 70 and a half years of age, it must be taken out at your actuarial rate to eventually deplete it regardless of whether you are still working or not. But that does not mean you must spend it. I'd stash it all in a safe, low risk bond fund at that age or a mix of equities and bonds at a younger age. Or just let it ride before age 70.5 if it is performing well in a low fee fund.

Rick
unless you started IRA withdrawals at 70.5 before recent tax law changes, the RMD start age is now 72 and they want to make it 75.
 

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My friend's parents just handed over their entire 401k to an assisted living development. Something like $750k he told me. 😬

Apparently this covers rent and care for both of them for the rest of their lives. They are then paid some small stipend for food, entertainment, etc.

I'd hate to do that. I'd sure like to have enough money to not only have enough to fund my retirement, but leave my daughter something as well.
wow That would be a taxable event. Yikes. The tax will eat up about 25% of it.
 

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My 401K is in the hands of my financial advisor - Oppenheimer & Co. as I know absolutely nothing about investing or moving money. They buy and sell stock based on their judgement - that's what they get paid to do.
 

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Oppenheimer funds like most other funds have high expense ratios (mgt fee) plus 12B1 and loads in the front or the back end. You can replicate the same portfolio at a much lower expense ratio. I would stay with mutual funds to diversify and just have Macro risk. Also keep an eye on them churning (buying/selling) stocks in your account as it benefits them at all times, and it may or may not benefit you
 
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