- quote -

What kind of "pension" plans? If these are defined benefit plans
you may want to rethink taking a lump sum. Often defined benefit
plans have additional features that can make them more valuable
than you think. They could have early retirement subsidies that
will be lost if you take a lump sum. Their benefits are insured
by the PBGC, you aren't subject to market risk. So, consider
carefully what you are giving up in order to take a lump sum.

Also, watch the interest rates and mortality factors, etc. being
used to value your lump sum. Rates are creeping up and higher
rates mean a smaller lump sum. And if your pension has a built
in CPI increase, again you may be giving up more than you think.

Frank

HW "Skip" Weldon wrote:
- quote -

Steve,
Do you have any company stock in your 401k? Meaning, stock in your
former employer?

-Tad

<<Advantages / disadvantages of doing this?>
If you like to be in the stock market, the IRA will probably give you a
lot more choices of what to invest in. If you like to be in cash
equivalent, the 401K may give you access to a "stable value" fund,
which pays better interest than most money market funds, but is usually
not available outside of a 401K.

If you get laid off after age 55, and before age 59.5, you can get
money out of a 401K with no 10% penalty. Not the case with IRAs.

John Cowart

The following was cross-posted. Because it was on-topic and the
moderators had time, it is copied below in its entirety with corrected
headers.
---------------------------
Subject: 401K and Pension Plans
From: "Steve Berkel" <puffns[at]yahoo.com
Greetings!

I would appreciate a pointer/advise on the following...background:
Just let go from my job of 21 years...I have a co. sponsored 401K and
two types of pension plan accounts (company I started my career with
was bought out and we ended up with two types of pensions) where I am
100% vested in each and can take lump sums and transfer them.....all
are being managed by Fidelity....I also have a Roth-IRA account with
TD Waterhouse and am 18 years away from retirement age.

With my forced exit from the company came a decision to consolidate
the pension plans into the 401K account(which I may be able to
transfer to some other self-managed plan in the future?) .

Is this the correct coarse action to take?
Advantages / disadvantages of doing this?

Many Thanks!
Steve

End copy--------------------



-HW "Skip" Weldon
Columbia, SC