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I will be receiving $6,000.00 from a closed out profit sharing program from my older defunct company. I do not want to roll it over into my current employers plan nor into my own traditional IRA account. The reason being is my current IRA is Twenthiest Century Ultra and the employers plan has me in comfortable Index Funds. I am willing to be a bit riskier with these dollars to capture a better return.

Am I better off starting this new account or rolling it over into my current IRA? Will they allow me to do this with no penalties??

Also fishing for a good fund with "moderate" risk. I am 30.
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Am I better off starting this new account or rolling it over into my current IRA? Will they allow me to do this with no penalties??

You can roll it into your current IRA with no penalties. I wouldn't put to much in an aggressive fund though. Try the Mutual Funds discussion board for fund recommendations.
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You can roll it into your current IRA with no penalties. I wouldn't put to much in an aggressive fund though. Try the Mutual Funds discussion board for fund recommendations.

Charlie,

If this is the case, then the $6,000 profit sharing account is considered in the same class as a 401K?

While I do believe if he is able that he can move this money to an IRA, wouldn't it be better to open a Rollover IRA so not to mix pre-tax with after-tax money? If he does this, doesn't this prevent him from ever rolling this money into a 401K if he so decides down the road?


Thanks,

Dogpile :-P


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If this is the case, then the $6,000 profit sharing account is considered in the same class as a 401K?

While I do believe if he is able that he can move this money to an IRA, wouldn't it be better to open a Rollover IRA so not to mix pre-tax with after-tax money? If he does this, doesn't this prevent him from ever rolling this money into a 401K if he so decides down the road?


Dogpile

I made the assumption that it was a qualified pension plan under 401(a) rules. I shouldn't have made an assumption. I should have told him to check.

Effective January 1 with the new tax laws, everything is fully interchangeable. You no longer have to keep things separate. You can even roll and IRA into a 457.
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