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Hi,

As a tech worker in the 90's I find myself changing jobs frequently and constantly having to rollover funds. I Currently have a lump sum in one account and a small piece in another account.

I am again on my way to a new job and soon the time will come when I have to decide if I will enroll in the new 401k, how much will I donate will I partake in stock options, etc, etc...

Currently my lump sum from a previous employer is sitting in a dormant account. That is, I can keep the money there, move the $$ from one fund to another but can't contribute any more to this fund. All monies that were put in have been put in pre tax and I would like keep it that way to avoid taxes and penalties ;o)

I don't want to roll it into a new company offered fund since I feel that within a couple of years I will be in this same position. I will however, enroll in the plan to take advantage of the employers contributions.

And now for the big what if. If I were to take all previous 401k plans and start an IRA (say through etrade), would I be liable for taxes and penalties? Am I only allowed to contribute 2k anually? Can I borrow from that account for a home loan.

The home loan is probably the highest priority right now. I would like to create a new ira that I have control over, put as much into it anually (say 10% of salary), take advantage of company contributions by enrolling into their 401k fund, and most importantly be able to borrow from my new ira that (the one I set up)to pay for a down payment on a home.

Any comments are graciously accepted.

gg

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>>>And now for the big what if. If I were to take all previous 401k plans and start an IRA (say
through etrade), would I be liable for taxes and penalties? Am I only allowed to contribute 2k
anually? Can I borrow from that account for a home loan.

The home loan is probably the highest priority right now. I would like to create a new ira that I
have control over, put as much into it anually (say 10% of salary), take advantage of company
contributions by enrolling into their 401k fund, and most importantly be able to borrow from
my new ira that (the one I set up)to pay for a down payment on a home.
<<<<<<<

would be nice......

you CAN consolidate all your (reg., *not* Roth) IRAs
and 401(k)'s into one IRA ...

you may ONLY contrib $2k to ALL (not each) IRAs in any
year --but rollovers aren't contributions. and that's
the max. depending on income it can be less. depending
on income and 401K at next job, the 2K might not be
deductible.

currently there's a 10K limit on contribs to 401K.

you may NOT borrow from IRA, only 401k and not all
401K's, and for someone who changes jobs frequently,
it's highly UN-recommended to borrow from the 401K.


hope this helps....


jp
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Keep the 401k's as long as you can. The limits usually are that they have limited investment options and many times they have restrictive rules--some of which can be burdensome. But most are subsidized by the employer and have favorable costs. IRA's can give many more investment options, but usually at higher cost. So keep the 401k if the plan meets your needs.
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Thanks for the advice Paul.

gg
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