I have a 401k from a previous employer that I left about 5 years ago. I have invested this money in index mutual funds and have let it sit for the last 5 years. However, I was thinking of moving this into a Traditional IRA. This would then give me the flexibility to invest in stocks. Would this be a good move? I would not be adding any money into the account since I already contribute to my current employer's 401k. I don't think I can take advantage of the Roth IRA since I make more that 95k. Also I am still young... 32, but want to make good investment choices. Any help is greatly appreciated.
If you have decided you want to invest in stocks, that is indeed a good reason to transfer your previous employer's 401K to an IRA. Presumably you will want to establish that IRA at a discount brokerage.By the way, you may still make annual contributions to a Roth IRA if you are married with an income up to $145k. If you are not married, you can still make annual $2K contributions to a conventional IRA even though you participate in your employer's 401K. Your contributions will not be tax deductible, but the earnings will still grow tax deferred. In your tax bracket, that is probably a valuable advantage.Best of luck to you. Fool on!!
Best Of |
Favorites & Replies |
Start a New Board |
My Fool |