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Author: VujnovGreg Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75375  
Subject: Wifes Retirement $ Date: 6/16/2000 1:11 PM
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My wife has recently left the teaching profession and is 37 years old. We want to take the 25K out of the Cal. State Teachers Retirement system due to it's single digit returns. We can take the money out without penalty.I'm a novice investor and would appreciate any comment or suggestions regarding where we can re-invest this money. Do I assume correctly that we can put this into a Roth account and into a vehicle that would do better than the single digit returns from the State Teachers System,

Thank you
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Author: jrr7 Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 22663 of 75375
Subject: Re: Wifes Retirement $ Date: 6/16/2000 1:32 PM
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Are there any tax issues involved in taking the money out (my hunch is there are).

You might avoid some of the tax hits by rolling the money over into a Conduit IRA, if that's allowed. What section of the IRS code is Cal S.T.R.S. under?

You can only contribute to a Roth account if you or your spouse have earned income and it's within certain limits.

As for where to put the money, that depends on your own needs, risk tolerances, and time horizon. Read some of the articles here at the Fool (I recommend the Fool's School) for some background.

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Author: rjm1 Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 22677 of 75375
Subject: Re: Wifes Retirement $ Date: 6/17/2000 10:01 AM
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My wife has recently left the teaching profession and is 37 years old. We want to take the 25K out of the Cal. State
Teachers Retirement system due to it's single digit returns. We can take the money out without penalty.I'm a novice
investor and would appreciate any comment or suggestions regarding where we can re-invest this money. Do I assume
correctly that we can put this into a Roth account and into a vehicle that would do better than the single digit returns from
the State Teachers System,


You have to move the money into a regular IRA and then from the IRA to a Roth.

Ask the staff of the retirement plan if you can move your money to an IRA. They should know if it qualifies. I would think it does.

Once you have the money in an IRA you can invest in almost anything that the trustee sells. Try a discount broker and you can buy any mutual fund he sells and any stocks, bonds etc he sells.

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Author: BGauer Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 22802 of 75375
Subject: Re: Wifes Retirement $ Date: 6/23/2000 9:19 AM
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VujnovGreg says, "My wife has recently left the teaching profession and is 37 years old. We want to take the 25K out of the Cal. State Teachers Retirement system due to its single digit returns."

My comment: I draw retirement from Texas teachers retirement. During the time I was contributing, they paid a nominal 5% on my contributions. However, my retirement benefits were NOT based on the amount of my contributions, but the number of years I had contributed. And there were "matching" contributions, also.

If your wife leaves her contributions in the system, what will she draw based on current projections? For example, if she has taught fifteen years, will she draw 30% (2% per year) of her three highest years' pay? To draw $1,000 a month, or $12,000 a year, she'd need $150,000 invested at 8%. To turn $25,000 into $150,000 (or better) in 27 years should be do-able.

Just wanted to point out that comparing the nominal return is not the whole story!

Sincerely, Betty G

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