Ask Terry Questions 401(k) what to do

401(k) what to do

By Terry Savage on August 05, 2018 | Financial Planning / Retirement

I left my job a year ago and am trying to figure out where to put my 401(k) (I know you hear this all the time). Listening to you I know it is best not to leave it where it is. My current program (John Hancock) will only cut 1 check, so wherever it goes, it goes in 1 lump. I would like to do a Roth, but I could not afford the taxes (at least on the whole thing) at this time.
The value is about $240,000. I am 63 and married. My husband is still working. On the investment spectrum I am moderately conservative. It was recommended to me to put the funds in the Allianz 222 Annuity. The 10 year “hold” period while not out of the question, does seem a bit long. I was also told once in there there was an option to move some of the funds to a Roth. Your thoughts?

Terry Says

OK, this is the time to do some financial planning, beyond investing. This is not only about choosing funds, but making appropriate tax plans and retirement withdrawal plans. (I’m sure it was a salesperson who suggested the annuity, not a financial planner.)

Second, you do NOT want your current plan custodian to “cut a check.” That will trigger all kinds of potential penalty and accounting issues. When the time comes, you will do a direct IRA rollover — from custodian to custodian. At that point it will be easier to set up your various investments if you choose to do that.

There is no rush to make any of these moves! In fact, if you will wait about two weeks, I am working on a column that will help you find a fee-only Certified Financial Planner, who has been verified as trustworthy and knowledgeable! It’s a new service designed for people like you, so sit tight.

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