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Author: bailey7094 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 169  
Subject: FF in a 403(b) ??? Date: 8/10/1999 3:40 PM
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hvyevy2 says:

In addition, I anticipated buying into the FF with some of the 403(b). Of course, I will pay taxes on all the withdrawals. Comments please.

Greetings hvyevy2,

It's my understanding that only funds are available in a 403(b) by law. Thus, if you want to do the FF bit with your 403(b) funds, you may have pull them out and immediately pay the taxes or roll them over to an IRA. As I stated in and earlier post, I plan to roll the 403(b) funds into an existing SEP IRA at retirement. There's little or no disadvantage as far as I know, and this will allow me to buy and sell equities, FF or otherwise, if I wish. If I still want an Index 500 strategy like I have now with Vanguard's VFINX, I can buy Spiders (SPY). All will be "tax deferred".

By the way, the 71.5 "hav tu" deal was a slip up. Since my birthday is October 16, my "hav tu" withdrawal age works out to just about 71.5 years. You are correct that it is usually closer to 70.5 .

Persevere!
FoolishProf
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Author: hvyevy2 One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 63 of 169
Subject: Re: FF in a 403(b) ??? Date: 8/10/1999 4:48 PM
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A little clarification on my part might make my path more visible. I will be 70 on 4/1/00, as I said. I am not pleased with my Wiseman (read broker)and so do not want to roll my (b) into my IRA. Valic has said I may leave my money in the (b) as long as I want. I have an IRA, my wife has an IRA (she is the same age, actually 6 months older), I have the 403(b) and a TSA. I am required to take a minimum withdrawl from each. I will use this to supplement my retirement and trust income for living expenses. I plan to pull some more from either my (b) or my IRA to set up a MMF for several years expenses in excess of the retirement & trust income. Then I plan to pull some more, and pay taxes of course, and invest in the FF or some other vehicle. This is where I am asking for advice. Note that if I roll the (b) into the IRA, I still have to pay taxes on the withdrawl when I do it......Say, wait a minute. I think I see what you are saying. Set up another IRA with a different (read discount) broker and then pay as I withdraw. But isn't that the same as just leaving it in the (b)? Your opinion, please.

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Author: GrayWulff Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 64 of 169
Subject: Re: FF in a 403(b) ??? Date: 8/10/1999 5:11 PM
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Say, wait a minute. I think I see what you are saying. Set up another IRA with a different (read discount) broker and then pay as I withdraw. But isn't that the same as just leaving it in the (b)? Your opinion, please

Assuming it is legal to roll a 403b into an IRA, that's the idea. The IRA, you can manage yourself, buying F4 or whatever else you want.

I've rolled two 401k's into my traditional IRA, and will probably roll my current one too.

Cheers,
GW

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Author: bailey7094 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 68 of 169
Subject: Re: FF in a 403(b) ??? Date: 8/11/1999 9:40 AM
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Hi, hvyevy2.

Say, wait a minute. I think I see what you are saying. Set up another IRA with a different
(read discount) broker and then pay as I withdraw. But isn't that the same as just leaving it in the
(b)? Your opinion, please.


No, it's not. In the IRA with the DB you have many options available to you that are not available in the (b). As I said before, in the (b) you can only invest in funds, by law. You are also in control and do not have to pay some wiseman's big sales commission. You may also roll your other IRA with the wiseman's firm into this new IRA with the DB, and should, in my view, it there is no heavy rear-end loading.

All of my tax-deferred funds will be in one "self-directed" IRA at Waterhouse very shortly after I make the big switch and get the "RETIRED AND LOVIN IT" bumper sticker.

FoolishProf

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Author: bailey7094 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 69 of 169
Subject: Re: FF in a 403(b) ??? Date: 8/11/1999 9:42 AM
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Assuming it is legal to roll a 403b into an IRA, that's the idea. The IRA, you can manage yourself, buying F4 or whatever else you want.

It is legal.

FoolishProf

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Author: hvyevy2 One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 71 of 169
Subject: Re: FF in a 403(b) ??? Date: 8/11/1999 12:27 PM
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All of my tax-deferred funds will be in one "self-directed" IRA at Waterhouse

How does one do this? Guide me since this is all new. I now truly have figured this out and think your advice concerning my IRA is great. I probably will also do this with my TSA after a ride out the holding period which is next September.

Thanks for the great assistance.

he2

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Author: bailey7094 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 72 of 169
Subject: Re: FF in a 403(b) ??? Date: 8/11/1999 2:54 PM
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All of my tax-deferred funds will be in one "self-directed" IRA at Waterhouse

How does one do this?


Hi, he2.

Just got back from looking at a potential site to build a retirement cottage. Still can't decide if its the right one. Don't want to make a mistake on something like that.

My answering your "how to" question may be a bit like a virgin who's read all about it trying to tell someone else how to have great sex.

I will contact the discount broker of choice, Waterhouse in my case, and explain what I want to do. There are forms to complete and, surely, the current custodian of the IRA or 403(b) will have forms to complete.

I have transferred funds from one custodian to another before, but these were from one 403(b) account to another when I got fed up with annuities. In this case, the receiving custodian (Vanguard) had forms with which to initiate the transfer. They also wanted a copy of the most recent monthly or quarterly statement for the account being transferred. Except in one case (Lincoln National), each of the custodians from which the funds were being transferred (Travelers and VALIC) had their own forms as well. One usually has to cash in all funds prior to the transfer. I think that in the case of an IRA in which publically traded investments (stocks, bonds, and some funds) are held, the actual investments themselves can be transferred to another IRA. But, this will not be the case in a 403(b).

I found out one thing very quickly, most custodians do not want to give up the job. I had especial problems with Merrill Lynch when I transferred my SEP IRA and my brokerage account to Waterhouse. Travelers and VALIC both were reluctant participants also. All kinds of excuses such as i's not dotted and t's not crossed!

I'm glad I got you thinking along these lines. You must decide if it is right for you, but it sure makes lots of sense to me. I want to be in control of my investments and the self-directed IRA helps.

Persevere!

FoolishProf

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