im Cate <jimcate[at]pdq.net> wrote:

- quote -

Remember that there are a lot of factors involved. First,
many 401k (and similar) plans have the same beneficiary
options as IRAs. So if that's important you need to ask.

Also, the TSP plan has some real advantages... for general
stock accounts (C Fund) they have extraordinary cost savings
and for fixed accounts, the last time I checked their
interest rates (G Fund) whip the socks off bank CDs and
mutual fund money markets. And many 401k plans have Stable
Value funds that do likewise.

So my suggestion would be to get a fix on what you wanted to
accomplish, then review the 401k and TSP for factors like
beneficiary choices (both spouse and non-spousal
beneficiaries), distribution options (interest only,
monthly, lump-sum, etc.), costs (loads and expense ratios)
and whether or not there are surrender charges/commissions
if you change your mind later. Then do the same thing with
potential IRA custodians.

It's not just a single issue. And each case will be
different.

-HW "Skip" Weldon
Columbia, SC

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << It may not be relied upon for the purpose of avoiding > << penalties that may be imposed on the taxpayer or the > << tax preparer. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

Has anyone reviewed the advantages and disadvantages of
keeping a 401k after retirement and withdrawing the required
minimum distribution amounts vs. rolling the funds over to
an IRA under circumstances in which one is generally pleased
with the performance, expense ratio, and investment options
of the 401K? (More specifically, we have one 401K and one
Government Thrift Savings Account.) I understand that one
advantage of rolling the funds over to an IRA is that there
may be tax advantages to heirs after my death and that of my
wife. However, although I can't predict the future, it does
not seem likely that there will be major tax consequences of
that nature. I also have the option of taking the 10-year
withdrawal option, which could provide some tax advantages.

I understand that there are a number of issues relating to
the particular circumstances, and that they should all be
reviewed in detail with knowledgeable tax and financial
advisors. So far I have met with a financial planner and
obtained a somewhat comprehensive set of recommendations and
also discussed related issues with my broker. However,
although their advice was on a fee-only basis, they seem to
have a bias, and possibly a financial interest, in directing
me toward an IRA, preferably one which they or an associated
firm would manage, and possibly a variable annuity. There
seem to be few completely independent, fee-based financial
advisors, and in particular, few who are knowledgeable about
the pros and cons of the 10-year withdrawal option.
(Meanwhile, I have ordered IRS publications 575 and 590,
which may help.)

Suggestions and recommendations for further sources will be appreciated.

Jim Cate

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << It may not be relied upon for the purpose of avoiding > << penalties that may be imposed on the taxpayer or the > << tax preparer. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >