UnThreaded | Threaded | Whole Thread (10) | Ignore Thread Prev | Next
Author: BruceCM Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 79749  
Subject: Re: help on ideas for retirement fund opportunit Date: 9/19/2012 2:01 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
Interesting, as I've worked with government employees for years and have never had occasion to run into an issue such as yours. I take it this is a state govenment?

I can't quite conceptualize what the 'bonus' you refer to is. It could be an actuarial acceleration of accrued benefits designed to incentivizing early retirement by paying you an early separation lump sum that is actuarialy taken from your pension. If so, this should be able to be treated like any other present value lump sum and rolled over into your IRA. But the $22,000 you indicate you'd receive sounds like the employer is doing a 20% (Fed) plus 6.7% (state?) withholding and sending you what's left as income for the year. If so, this cannot go into a tax deferred account...except perhaps a variable deferred annuity, which I don't recommend due to high expenses and crappy investment choices. You could use growth ETFs which are quite tax efficient, and hold the income producing part of your investment allocation in your IRA, such as REITs, bonds, utilities, etc.

If you put the #22K into a brokerage account and the investment provides an average 5% annual return, the value of the account would grow to $58,370 after 20 years. You don't give the early retirement annuity amount, so I can't calculate what the likely future value would be.

Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (10) | Ignore Thread Prev | Next


The Retire Early Home Page
Discussion on accelerating retirement day.
Post of the Day:
Macro Economics

Looking at Oil and Gas
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
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.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
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.