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My job offers a 457 tax deffered plan,instead of a 401K.I can retire at a young age in 4 more years and collect half of my current yearly salary for the rest of my life.Will it be wise to start contributing to the 457 plan or to a Roth IRA.I believe you can't roll over your funds in a 457 plan.I will be 46 in 4 more years and plan on openning my on business.
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The answer to the question has to do in part with:
does your employer contribute any matching funds to the 457 plan?
Do you have good investment choices?

Secondly, you should know that it isn't an either/or situation. If the 457 offers decent investment choices OR if there is an employer match, by all means contribute enough to collect all the free money available, and to defer income.
If you qualify for a Roth (income under $150000 annually for married filing jointly) you can contribute $2000 annually.) Do it.

Best wishes, Chris
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My job offers a 457 tax deffered plan,instead of a 401K.I can retire at a young age in 4 more years and collect half of my current yearly salary for the rest of my life.Will it be wise to start contributing to the 457 plan or to a Roth IRA

Hello orsogna,
This depends as, stated in an earlier post, on the choices in your 457 plan I don't think 457's do matching funds particularly when you have a pension and it sounds as if you do. Also will you be in a higher or lower tax bracket when you retire? Higher? go with the Roth and pay the taxes now. Lower? Take the 457 (if the choices are good) and pay the taxes later.

I believe you can't roll over your funds in a 457 plan.I will be 46 in 4 more years and plan on openning my on business

This is currently true, but there is legislation currnetly passed by the house and in review by the senate to change this so you can roll over 457 funds into a traditional IRA. This is the same bill that would raise contribution limits among other things.
Hope this helps.
Bring me a line,
Brian
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Foolishoamy wrote, in part:
I don't think 457's do matching funds particularly when you have a pension...

There are some that do. The Commonwealth of Virginia has a 457 DCP, I receive a cash match and a defined benefit plan is automatic as well. This appears to be the exception, but it exists (luckily).

BmF

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Foolishoamy wrote, in part:
I don't think 457's do matching funds particularly when you have a pension...

There are some that do. The Commonwealth of Virginia has a 457 DCP, I receive a cash match and a defined benefit plan is automatic as well. This appears to be the exception, but it exists (luckily).


Hello BookmFool,
I stand corrected. Do you also have a defined benefit pension? If so you are extemily fortunate! However, if you are a police officer as your name indicates you deserve every bit of it!!
Be Safe,
Brian

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Hello again there Foolishoamy,
Do you also have a defined benefit pension?

Yes, contributions are made by our employer.

...if you are a police officer as your name indicates you deserve every bit of it!!

I was initially employed in that capacity by the state, but now I'm a magistrate. But, I would say your calling makes you just as deserving.

VR

BmF

PS: What part of NC is your favorite spot?

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What part of NC is your favorite spot?

Bmf,
I like western NC. Being a flatlander my entire life I am really drawn to the mountains. I have never been to the outer banks, so they may be nice too. I did however grow up in the Fl Keys so I've done the water thing. I may be showing my ignorance here, but what does a magistrate do?

Good Luck,
Brian
P.S. Appologies to anyone not interested in this thread, or feel free to join in.

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A short and sweet description would describe us as being at the very bottom of the food chain in the judicial system. Plaintiffs/victims/law enforcement come to us for warrants and such.

Most people don't want to see me, because they're either a victim of a crime, or they've just been arrested for allegedly committing one.

BmF
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