Message Font: Serif | Sans-Serif
No. of Recommendations: 0
The State of Colorado allows members of Public Employees Retirement Association,a 401(a)Plan, to purchase years from their 401(k) and after tax sources. The average return on buying time in the this pension plan is approximately 13 percent plus cost-of-living increases which vary. If the cost-of living increase is 3 percent, the return is 16 percent for life. I can "strip" another retirement program, a 457 plan, to buy more years, but will have to pay taxes of 35 percent.

Now for the question. Is it better to leave the money in the 457 plan to grow and take it out later, or buy the years? I need a minimum of 20 years to retire with a pension, and already have that.
Print the post  


When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.