Pension terminated
Hello,
In June of 2022 our pension program at work was terminated. In 2023 we will have the option withdraw completely or to do nothing and leave the money with the new company handling the pension program. We are not sure if the company is federally insured it was a question that someone brought up and are looking into. What do you recommend I do should I leave the money or invest in in another retirement vehicle? Thank you.
Terry Says
Immediately ask if you have the option to do a ROLLOVER to an IRA! If that’s allowed, then by all means contact Fidelity or Vanguard and they will help you do the rollover. Then you’ll have to decide on which funds to invest in. Depending on your age, you might want to put half in the S&L 500 stock market fund (if you’re under 50) and 1/4 in their Equity Income Fund, and maybe leave 25% in their money market fund.
If a rollover isn’t allowed, then let them move it into the new plan. It is safeguarded under ERISA — as good as a federal guarantee (not against market loss, but against fraud).
If you just take it out, you’ll pay ordinary income taxes and lose all future tax-deferred growth.
