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Author: gtstarling Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75859  
Subject: Re: 401-k rollover Date: 1/22/2000 7:03 PM
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Greetings atofool,

You wrote,

My former company was closed down and the 401-k plan terminated and I now have the rollover options. Any pro or con to the following suggestions:

1. rollover the entire amount into the new company plan (approx $250k)
or
2. As suggested by the former fund manager (an Insurance company)- rollover 1/2 to new company plan so I have the loan option available and place other 1/2 in a variable annuity through the former insurance company which managed the original 401-k (will have similiar investment options.) This was also suggested by my insurance agent.
or
3. Any other foolish advice:
the message board mentioned Vanguard Index Fund or just place funds in a rollover IRA until I have availed myself to the FOOLISH WEBPAGE.


The former fund manager (insurance company) just can't wait to get their grubby little paws into your pocket with a variable annuity! High fees! High commissions! Limited choices of investments! High withdrawal back-loads! Years before you can access your funds to move them anywhere else without paying those huge back-loads!

Park the money in a Vanguard Index Fund within an IRA until you find a better place to put it (which may be never).

Believe me, variable annuities are like tar babies - easy to get hold of, but hard to turn loose of!

Run, don't walk away from the 2nd option given. To roll it into the new company IRA is a possible choice, if they will accept it. However, that depends on the choices you are given there.

In your IRA (rollover), your choices are virtually limitless! You might even choose to convert all or part of it from there into a ROTH IRA and be done with the tax consequences for that money ever again!

Hope these kind words are helpful to you. (By the way, Peppermint Pattie will probably have a differing view. She is a true spokesperson for the insurance Wise men.)

Gemstarman
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