Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I was previously employed with a company that once offered a pension. I was there long enough to qualify for the pension. They discontinued funding the pension about 4-5 years ago I think, and I have since left the company.
Now they are offering a "lump sum distribution" of the pension up until mid December (not a lot of money, but definitely enough not to ignore). I read that they are having problems funding their pension, so this may be the reason why.
My question is what type of professional do I contact if I have questions about what I should do with this money? I'm thinking about rolling it into something, but I am not sure what type of person to contact. Also want to make sure I am not doing anything dumb by taking the cash out. Any suggestions?
I'm thinking about rolling it into something...
Also want to make sure I am not doing anything dumb by taking the cash out.
Nope. That's the easy part. The issue is how you handle the transaction to avoid taxes.
Rolling the money over into either your new employer's pension plan, if it accepts rollovers,
or into a traditional IRA lets you avoid paying an income tax on the distribution.
Quote:
...but I am not sure what type of person to contact.
My question is what type of professional do I contact if I have questions...
Do you have any retirement funds or other investments now?
Assuming so... who do you go to for help with those?
That person will be the most familiar with your situation and best positioned to be specific.
I'd roll it into a Vanguard targeted retirement IRA and forget about it and watch it grow safely. You can always move it into something else when you have more info or an adviser or something. You don't need to hire a professional (or vet one) just to rescue the pension from the old company, which sounds like the primary important thing to do, and do it before they pull another fast one on the pension plan.
Vanguard has the lowest fees, etc., and is considered a very safe and "dull" place to put pension money. My company pension plan just cut out a bunch of choices and if you don't take action by Jan. 1, 403b pension money goes automatically into a Vanguard targeted retirement fund based on when you turn 65. Couldn't be simpler or safer for OP and could always be moved later as it suits. Best wishes and grab that money!
You can roll a pension or profit sharing type plan into an IRA, just make sure the check goes from company to company and not to you at any point.
Have you decided on a fund or provider? Someone like Vanguard could put you in touch with the right professionals to advise you. Accurate information can also be googled for free.
I agree, talk to a financial planner that has experience with pension distributions. An IRA is obvious but without knowing the rest of your financial situation, that might be too much into taxed retirement benefits for you. Maybe your plans are set and rolling it into an annuity to pay for long term care down the road is a better idea for you (major tax savings with that). Get a comprehensive review of your current situation and find what is the best for you. If someone wants to just roll it into an IRA without getting a good history from you, walk away and find someone else.
Lots of ideas! Thanks for all the suggestions. This gives me a much better idea of what to do next. I have met with financial planners before just a few times, but never kept up with it. I think I need to do a better job. I also have a retirement savings plan with the old company, and it is overseen by a really big bank. I think I'll start with contacting them for a financial planner.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
