Retirement Investment Approaches

Discussion in 'Business, Investing & Finance' started by SeabeeGator, Apr 14, 2020.

  1. SeabeeGator

    SeabeeGator Well-Known Member
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    @BMf is that something USAA can do?

    Brad, I thought there were penalties and taxes associated with that? Or is it better just to take that hit now because it’ll pay off long term? My TSP is set up with the post-tax option - made the right call there!
     
  2. bradgator2

    bradgator2 Rioting
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    When you leave a company you can take the 401k and put it into an IRA. Zero fees or penalties. It has to be a rollover... not a withdrawal then deposit. I am not certain if there is a time limit on when you have to do it. Some brokerage accounts even give you a bonus.

    edit: looks like the rule is 1 rollover per yer. And once you start the rollover... you better have it complete in 60 days or it’s considered a withdrawal.
     
    • FireFoley

      FireFoley Senior Member
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      Yes this!. That 401K that you can't contribute to is costing you money b/c it has some type of fee associated with it. If you roll into an IRA you open it up to all stocks/bonds, etc. etc etc. And if you want mutual funds, that too. And if you wanted to use that as your play money as you mentioned if you don;t have a Roth, there you go. Any and all places have free accounts/zero trade commisions. etc. even on some funds and ETF's. B/C they use your money to loan to others seeking leverage if you are not using it. And if you buy stocks they use your stocks to loan to others who want to borrow it. so you don;t get directly charged but they still make money, Not like the suckhole that is getting bux from that 401K that you can't even contribute to.
       
      • bradgator2

        bradgator2 Rioting
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        agree 100%. The 401k fees are criminal. Get that money out of there asap.
         
        • SeabeeGator

          SeabeeGator Well-Known Member
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          What about 403b? My wife has two of those. Can they rollover too? I would start with the 401k then work those two each year.
           
        • SeabeeGator

          SeabeeGator Well-Known Member
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          Interesting. What would I have to pay to convert from a traditional to Roth set up? If usaa is not a good option, are there others y’all recommend researching?
           
        • BMF

          BMF Bad Mother....
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          Like I said earlier, USAA is getting out of the brokerage business so I don't think that's where you'd want to do it. I had a 529 for my son through Fidelity, it was a good fund.
           
          • bradgator2

            bradgator2 Rioting
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            yup. The nice thing is it is all consolidated into a single spot. We also manage the 529s from there. So 2 IRAs, 2 Roths, and 2 529s all on one statement. Only my current 401k is separate. When I leave, it’ll get sucked in there too.
             
            • bradgator2

              bradgator2 Rioting
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              I am not necessarily suggesting them... but they have an excellent writeup on it:

              Rollover IRA | TD Ameritrade
               
              • SeabeeGator

                SeabeeGator Well-Known Member
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                Who do you have? Are you happy with their performance?
                 
              • bradgator2

                bradgator2 Rioting
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                here is also a comparison article:
                Roll Your 401(k) Over to an IRA: The Best Providers - NerdWallet

                I had no clue about of any of this stuff when I started. I walked into an Edward Jones office and have been with that guy for almost 20 years. I feel like I could go it alone now but I am loyal. Plus he has really helped me with life insurance and other things. If I die, my wife simply makes one phonecall. So yes, I am happy. Even though I know I am paying for it.

                I also have a TDAmeritrade custodial account for the kids. I make them save money into stocks. Very very happy with them and those accounts.

                I also dabble with my own stocks in a new account with SOFI. I did that because I refied my mortgage with them. I am also transitioning all my banking with them. So yes, very happy with them as well.
                 
                • FireFoley

                  FireFoley Senior Member
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                  I have no clue about USAA and their IRA options or any trading platform they may have. So I am not recommending anyone. but you could have that IRA at say Fidelity, Schwab, ETrade, Interactive, and they all have great platforms for trading. And all of them have zero cost platforms.

                  Regarding converting to a Roth vs traditional IRA. On the surface, you would have to pay the income tax on the amount of the 401K upfront if rolled into a Roth, b/c all that money was pre tax. However someone mentioned somewhere else that they might have spread that tax over a few years in this Treasury package. If you go into traditional it cost zippo b/c you are going from pre tax 401K to pre tax IRA So my thoughts are kind of this. Let's say it is not a ton of money, but it is YOUR money. If you are willing to pay the tax immediately, then whatever value that the Roth becomes over the next hopefully 30+ years will all be tax FREE. Remember what the idea and thought was by the government when they enacted 401K's , IRA's etc. When you start at a young age, usually you are in the lower tax bracket, so your tax rate is lower. But by the time you begin drawing your Required Minimum Distribution.you will probably be in the top bracket or one a lot higher than when you first started saving. so even though you have more money, the governement gets much more in taxes than they would have had they taxed you many many years ago on a smaller amount
                   
                  • Detroitgator

                    Detroitgator Well-Known Member
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                    You should be able to do all rollovers with USAA with no problem. Just call them, it's not hard. You open the account with USAA, there's some paperwork to transfer the funds, that's pretty much it. It's pretty much the same with any institution.
                     
                    • BMF

                      BMF Bad Mother....
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                      As I previously mentioned....USAA is going out of the brokerage business. They partnered w/ Charles Schwab, all of their accounts will roll over to Charles Schwab in late May.
                       
                    • SeabeeGator

                      SeabeeGator Well-Known Member
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                      Probably a dumb question but is that brokerage and mutual funds? They have them listed separately on the site and the mutual fund is teamed with Victory.
                       
                    • BMF

                      BMF Bad Mother....
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                      I believe they are keeping their own mutual funds, but Charles Schwab will manage them - so if you make a trade (i.e. buy a USAA mutual fund, you'll buy it through Schwab - i think....). I need to look more into this because in my Roth I have stocks and mutual funds - I also have two CD's, which they are cashing out early and transferring the cash into the Schwab money-market. So if they keep managing the USAA mutual funds I'd have a USAA account w/ 4 mutual funds and then the rest would roll over to Schawb, so that doesn't make sense. Anyhow, I'm not 100% sure of that answer.
                       
                      • SeabeeGator

                        SeabeeGator Well-Known Member
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                        I read that it’s a good thing that usaa is moving it’s brokerage business to CS. I guess it was generally more expensive than many other options and only got 2.5 stars on nerd wallet. They’re normally excellent but maybe the small number of people who use that service (compared to other sites) required higher fees.
                         
                      • BMF

                        BMF Bad Mother....
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                        I've been very happy with it. Plus I like having everything in one spot: bank account, auto and home insurance, and brokerage. Now I guess that last part is gone. I have a TD account that is managed by an adviser, I have two other bank accounts (two credit unions, one I've had for 30 years the other I opened because they had a great savings rate), plus TSP....now add in Schwab.
                         
                      • SeabeeGator

                        SeabeeGator Well-Known Member
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                        That’s why I took a long hard look at their mutual fund stuff last night when considering rolling over 401k. Would be nice to have it on the dashboard. TD sounds good too tho.
                         
                      • Detroitgator

                        Detroitgator Well-Known Member
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                        Yeah, I think the USAA/Schwab arrangement will be like USAA/Progressive is. Separate, but linked.
                         

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