Profit Sharing/ 401(k) Rollover?

[taxjungle]

Hello, This is my first post on this forum. I would appreciate some ideas from this group. My husband will be retiring about April '07. Should we leave his Pension/401(k) with the company or roll it over into an IRA or into something else? We want to withdraw just so much a month, but we would like to be able to withdraw a little extra as the cost of living continues to rise. Do I need to pay a financial advisor to answer this simple question? We also have some IRAs but they will stay there until needed. What are your thoughts?
Thank you in advance for any insights you may be willing to give. CR

[veritas]

Hello fellow Oregonian.

Your question may seem simple but it is not.

How is the 401k/pension invested? How much? How old are the both of you? What are your other sources of income? What kind of Iras(traditional/Roth)? How astute are you with investments? How much time do you want to spend on them?

In general I would prefer to manage retirement funds from an IRA but not always.

Those are the first questions that come to mind. My friend Sea-Tax will probably have some things to add.

[taxjungle]

Thank you Veritas for your reply.
To answer your questions:
The Profit Sharing Pension & 401(k) are both PRE-TAX.
Age: 65 / 60
Other sources of income will be: Soc. Sec. & my tax-prep business, & IRAs.
We want to put them into SAFE funds, that will take care of themselves as far as growth potential and we want some control over amount of withdrawals. That's why we lean toward IRAs.
I hope this answers your questions, and I again Thank You for your insight & that of any others. CR

[Bees Knees]

Keep in mind that an IRA is no more safe or risky than a 401(k). The only difference is that the IRA is managed by you, and the 401(k) is administered through an employer plan.

I would prefer to have my money in an IRA simply because I have control over which investments to put it in. The 401(k) limits your choice to whatever options your employer allows. So my advice is to roll the money into an IRA. As to the risk factor and which type of IRA investment you choose, that is something you might want to talk to a financial advisor about.

[DaveO]

An IRA at a large Mutual Fund Family

will likely suit your needs. You can do the rollover yourself or have one of their people help you through it saving yourself the commissions of an agent. The trick is selecting the correct mix of funds to provide safety and growth. Educate yourself about fees, commissions and services of fund companies then narrow it down from there by comparing long term results. Select a asset allocation that reflects your risk tolerance. Avoid lettting some one else have control over moving your funds around,

[taxjungle]

Also, Thank you, BeesKnees & DaveO

I appreciate all of your good responses. I printed them out and will consider your thoughts on the matter. I hope I can assist someone on this board in the future. Have a great day!

taxjungle.

[Unregistered]

If you don't want to work with an advisor,

try Fidelity. They have "investment centers" across the country that are available, at no cost to their clients. Also, there funds are no load funds, so none of your amount goes to commissions.

I don't necessarily agree that you shouldn't let someone else manage your funds, as they may be able to generate significantly better returns than you can on your own, and it will most likely cost you between 1 and 1 1/2 percent annually.

Either way, moving out of the 401k does provide you with more control over your investments, and control is key when planning for the future.

JoshInNC

[veritas]

They are no-load but....

They also charge advisory fees if you choose to have them manage your funds