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Old 05-29-2014, 03:34 PM
 
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any one who plans around obscure unlikely things happening like the gov't taking your ira money ends up usually shooting themselves in the foot.

that thinking sure would have had the gov't taking your money. in the form of taxes you shouldn't be paying if you used the right vehicle like a roth .
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Old 05-30-2014, 07:21 AM
 
Location: Central Massachusetts
4,800 posts, read 4,842,106 times
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Quote:
Originally Posted by Red On The Noodle View Post
My employer had a SEP plan. They added a percentage of our salary off and on for about 5 years (one year there was no contribution). They got audited and turns out boss was not treating us all equally or adhering to the SEP plan rules about percentage amounts. Several employees had to pay back not only the extra money, but any interest/gains they'd made on that money. Now my employer does nothing. I take care of my own savings/retirement plan.

I do not like IRA/401Ks. My fear is down the line the government will see all these accounts and figure out a way to get their hands on the money or a way to dole it out to you pennies at a time.

That is a pretty dim view. I understand the sentiment but to toss the baby out with the bath water just because you came across a floatie thing in the water isnt good.

IRA's and 401k's are good vehicles to generate a nest egg that can sustain you in the future. As has been said here and in other threads if you have been paying attention is that you need to contribute to your account. If you don't you wont have it in the future. The sooner you start the better your plan is.

If your employer sponsors a 401k which is much different then a SEP and have different rules you would get good tax treatment. If it is a Roth or has Roth in it that is where you should put your money. If not then the standard 401k is the next best thing.
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Old 05-30-2014, 07:54 AM
 
Location: ☀️ SWFL ⛱ 🌴
2,427 posts, read 1,663,961 times
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DH works for a major corporation that had a 6% match to start with, it's lower now. I'm retired and my small company had a 401k with profit sharing that was tied to performance. We both contributed 12% and were taxed for going over the deferred amount. We started in our thirties.

DH has never left his job but has been through three buyouts over the years with different company acquisitions. The first company had a pension which he never paid attention to since he never saw $ amounts for the ten years he was in it. After the second buyout the pension was dropped and they went to solely 401k. This was where our focus was for years. He had no idea what his pension was worth (he had forgotten about it) until a few years ago when the pension was being offered up with a lump sum option so the old company wouldn't have to administer it anymore.

Last edited by jean_ji; 05-30-2014 at 09:24 AM..
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Old 05-30-2014, 10:41 AM
 
Location: USA
1,815 posts, read 2,241,646 times
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Quote:
Originally Posted by golfingduo View Post
That is a pretty dim view. I understand the sentiment but to toss the baby out with the bath water just because you came across a floatie thing in the water isnt good.

IRA's and 401k's are good vehicles to generate a nest egg that can sustain you in the future. As has been said here and in other threads if you have been paying attention is that you need to contribute to your account. If you don't you wont have it in the future. The sooner you start the better your plan is.

If your employer sponsors a 401k which is much different then a SEP and have different rules you would get good tax treatment. If it is a Roth or has Roth in it that is where you should put your money. If not then the standard 401k is the next best thing.
I do have my own savings/portfolio accounts. Just not an IRA or 401k. I'm not locked into forced withdrawals, early withdrawal penalties, etc.

Since I've never worked for a company that provided matching dollars, I saw no reason to get on the 401k bandwagon.
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Old 05-30-2014, 02:12 PM
 
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the price of admission for putting money in your taxable account is the same as a roth.

only your taxable account is taxed forever and the roth will never be taxed anymore,

that is a huge reason to have not gone the route you did.

the traditional choices would have grown more money tax deferred by growing money on money you would not still have in the taxable account since you had to pull it out for taxes on your gains and distributions.
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Old 05-31-2014, 02:47 AM
 
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ever notice the common denominator between folks who do poorly financially and the beliefs about markets , the econmy and investing are usually off in left field somewhere.

it is a theme you see and hear over and over.

usually it is because they have so little interest in anything financial that they believe their own bull-sh*t to really be true or the only outcome.

most of their poor decisions are based on just lack of understanding so they just go through life parroting what they hear from other mis-informed people.

sometimes they do okay but certainly no where as good as had they not listened to their own flawed advice.
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Old 06-02-2014, 08:38 AM
 
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I'm 48, Icontribute 6% of my salary,and my company matches to 7% of the 6%. So the total is essentially 13%.
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Old 06-02-2014, 10:47 AM
 
Location: USA
1,815 posts, read 2,241,646 times
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Quote:
Originally Posted by mathjak107 View Post
ever notice the common denominator between folks who do poorly financially and the beliefs about markets , the econmy and investing are usually off in left field somewhere.

it is a theme you see and hear over and over.

usually it is because they have so little interest in anything financial that they believe their own bull-sh*t to really be true or the only outcome.

most of their poor decisions are based on just lack of understanding so they just go through life parroting what they hear from other mis-informed people.

sometimes they do okay but certainly no where as good as had they not listened to their own flawed advice.
Is this meant for me? If so, I'm disappointed in you mathjak. I always read your posts because you know what you're talking about and you give clear, detailed explanations and I've never seen you talk down to anyone that had problems understanding financial matters.

I have never depended on an employer for my retirement planning/security (I'd be up the creek if I did, since in my field, there either are no such benefits, or the benefit is very short lived). From my reading here in this section, I am already on par in the amount of money I have for retirement with most of the newly retired. Since I still have many years left to retirement, I will be even better off when I get to that magic age. AND I DID IT ALL ON MY OWN -- so it can be done.

I still feel the rules for taxes, withdrawals, and anything else to do with 401k, will change when the middle and tail end of the baby boomers retire and start drawing that money, and you can be sure the new rules will not benefit the "little people."
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Old 06-02-2014, 05:00 PM
 
71,461 posts, read 71,629,249 times
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the rules can change even faster on your reguar taxable account and already has. the increase in capital gains tax on it is an example.

i can't see worrying about a flyer happening out in left field to existing retirement accounts.

with 80 million retiring baby boomers that would be political suicide.

in the mean time the after tax cost to fund a roth is the same as a taxable account . only the roth is never taxed and the taxable account is forever taxed..

not a good tax saving move at all avoiding a roth .

you can debate whether to do a roth or a traditional ira but a roth to a taxable account is a no brainer.

in my opinion folks should plan around what was , what is , and what stands a good chance of continuing. they usually shoot themselves in the foot when someone gets a remote chance scenerio in their head and plans around the flyer.
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Old 06-03-2014, 04:20 AM
 
71,461 posts, read 71,629,249 times
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a study by carnegie mellon has concluded that by not putting the right assets in the correct investment vehicles available to us like roths,deferred tax accounts and regular taxable accounts you can cut your amount of spendable cash in retirement by a whopping 20% difference because of compounding and tax differences..
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