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Author: skfrey2001 Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 74759  
Subject: 401K & RothIRA + stocks? Date: 1/3/2005 2:35 PM
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Hi,

I would appreciate any advice concerning this retirement question. Currently, I contribute to my company 401K to get the match, I have fully funded ($3,000) a ROTH IRA for 2004 and would like to know if it is possible to set up another type of retirement account to transfer some of my stocks? I'd like to transfer a value of about $3,000 dollars. I have less than $10,000 in retirement accounts contributed during 2004. From my understanding, I am not eligible to set up another IRA since I have contributed $3,000 dollars to the Roth? Is there another retirement fund where I can transfer the stocks? If it matters, I am 36 and earn less than $95,000 and single.

Thank you.
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Author: Fuskie Big funky green star, 20000 posts Top Favorite Fools Old School Fool Ticker Guide SC1 Red Winner of the 2010 Rule Breakers Challenge Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 43851 of 74759
Subject: Re: 401K & RothIRA + stocks? Date: 1/3/2005 4:21 PM
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I would appreciate any advice concerning this retirement question. Currently, I contribute to my company 401K to get the match, I have fully funded ($3,000) a ROTH IRA for 2004 and would like to know if it is possible to set up another type of retirement account to transfer some of my stocks? I'd like to transfer a value of about $3,000 dollars. I have less than $10,000 in retirement accounts contributed during 2004. From my understanding, I am not eligible to set up another IRA since I have contributed $3,000 dollars to the Roth? Is there another retirement fund where I can transfer the stocks? If it matters, I am 36 and earn less than $95,000 and single.

The good news is that 2005 is a new year, and you can contribute another $4000 between now and April 15th, 2006. The bad news is that you can only make cash contributions to an IRA. That means the only way to move your stock holdings into the Roth would be to sell and repurchase. If your current RIRA does not allow for individual stocks, you can always open a second account with a discount broker like Scottrade ($7 on-line transactions).

Fuskie
Who wonders about your eFund savings and whether you have established a budget for 2005...



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Author: skfrey2001 Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 43853 of 74759
Subject: Re: 401K & RothIRA + stocks? Date: 1/3/2005 5:04 PM
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Hi,

Thank you for your reply. Yes, I have an efund and budget... no debt. Want to see if I can transfer stocks into any sort of retirement account and if so how much per year.

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Author: dsemmler Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 43854 of 74759
Subject: Re: 401K & RothIRA + stocks? Date: 1/3/2005 5:17 PM
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Want to see if I can transfer stocks into any sort of retirement account and if so how much per year.

As Fuskie mentioned, I believe all retirement accounts must be funded with cash contributions or via a rollover/transfer from an existing retirement account.

Where do you hold these stocks now? Are they in a taxable account? Are they in a retirement account? If so, what type of account?

As for the retirement accounts available to you, it sort of depends on your work situation. Do you have a 401k, 403b or something similar through your employer? Are you self-employed? If so, you can have a SEP-IRA that has higher contribution limits. If you have a 401k or similar vehicle sponsored by an employer, that pretty much leaves you with the Traditional IRA and Roth IRA as retirement savings vehicles that may be tax advantaged. Other than that, the only thing that I can think of would be a Health Savings Account but I don't know much about those.

Any reason you don't want to keep the stocks where they are now?

dt

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Author: skfrey2001 Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 43857 of 74759
Subject: Re: 401K & RothIRA + stocks? Date: 1/3/2005 5:30 PM
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I do have a 401K through my employer and also a roth ira with ameritrade. My stocks are taxable and I am researching other ideas for retirement planning. I don't want to sell the stocks but thought, if possible, it could be a wise long term investment to transfer some stocks from a tax account into a non-taxable retirement account. Thanks for your input.

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Author: 2old4bs Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 43873 of 74759
Subject: Re: 401K & RothIRA + stocks? Date: 1/4/2005 2:53 PM
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it could be a wise long term investment to transfer some stocks from a tax account into a non-taxable retirement account.

It could also be wise to leave those stocks in the taxable account and hold them for more than a year. In a taxable account, if stocks are held more than 1 year, gains are taxed at low rates (15%). OTOH, retirement accounts like 401Ks will be taxed at (usually) much higher ordinary income rates, and if rolled over into IRAs, there are restrictions on when you must withdraw the money, and how much you must withdraw each year during retirement. For these and other reasons, many Fools have both retirement accounts and taxable accounts--the taxable accounts should add flexibility to your retirement withdrawals.

2old


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Author: skfrey2001 Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 43875 of 74759
Subject: Re: 401K & RothIRA + stocks? Date: 1/4/2005 6:07 PM
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Thanks for your comments! I am sifting through lots of information and welcome the advice.

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