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What to Do With an Old 401(k)
Tweet Share on Facebook August 8, 2011 Comment (11)When you leave your job—whether you're laid off, find a better job with a different company, or quit to go back to school or start a business—you have to make a decision about what to do with the money you've accumulated in your 401(k) or 403(b) retirement plan. Many people don't know they have choices. Here are some options on what you can do with old retirement investment accounts:
Roll your 401(k) into a self-directed individual retirement account (IRA). This choice is usually the best move because you'll have more control over your investments. Like a 401(k), a self-directed IRA is a tax-deferred account. However, most IRA providers offer an unlimited number of investment choices, rather than the small list of funds an employer provides. So if your situation changes, you'll be able to choose any investment that's best suited for your needs. In addition, if you want help from a financial adviser, you can choose any adviser rather than being restricted to services offered by the 401(k) plan.
[In Pictures: 6 Numbers Every Investor Should Follow.]
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How to Avoid Making Costly Investing Mistakes
Tweet Share on Facebook August 5, 2011 Comment (2)This is a difficult market for everyone―traders and investors alike. So how do you keep from making mistakes?
With so much at stake and no way to know how things will ultimately play out in Washington, the question is not whether you'll make mistakes, but how to keep from making the kinds of mistakes that will have a long term effect on the quality of your lifestyle.
[In Pictures: 6 Numbers Every Investor Should Follow.]
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Phyllis Borzi Wants to Save Your IRA
Tweet Share on Facebook August 4, 2011 Comment (1)Just when you think that our government is full of incompetent career politicians who can't get anything right, a real hero rides in.
You've probably never heard of Phyllis Borzi. She is an assistant secretary at the Department of Labor and she's helping you and our country in ways few will ever appreciate.
We've written extensively about the inherent conflicts of interest when you trust someone with your money. In finance circles, it is called "agency risk." Yes, your broker, or mutual fund manager may not fully put your interests ahead of their own. These conflicts almost define how the investment management business operates and is regulated.
[In Pictures: 6 Numbers Every Investor Should Follow.]
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A Financial To-Do List for the Rest of 2011
Tweet Share on Facebook August 3, 2011 Comment (2)Now that the debt ceiling crisis is behind us, perhaps we can all refocus on getting and keeping our own financial house in order. While everyone's to-do list will be a bit different, here are some suggestions.
For the self-employed. First, if your tax return is on extension, you still have time to make a contribution to a SEP-IRA for 2010. If you file a corporate return, your deadline is September 15, and if you are a sole proprietor the deadline is October 15. You can either contribute to an existing account or open a new SEP.
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3 Ways to Fix Your Own Debt Ceiling
Tweet Share on Facebook August 3, 2011 CommentAmericans can finally rest assured that the debt ceiling issue is behind us. Or is it?
Think of the debt ceiling issue as someone who says, "For the next year, I will pay my mortgage with my credit card. I will then pay back what I borrow on my credit card with some spending cuts that I take over the next 10 years."
Seriously? 10 years?
[In Pictures: 6 Numbers Every Investor Should Follow.]
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Stick With Tried-and-True Funds
Tweet Share on Facebook August 2, 2011 Comment (16)A bunch of new exchange-traded funds (ETFs) and mutual fund announcements have come across my desk lately. One was for the Guinness Atkinson Renminbi Yuan & Bond Fund (GARBX), a bet on China's currency. There's also the First Trust NASDAQ CEA Smartphone Index (FONE), an ETF that invests in smart phone makers. ProShares Hedge Replication ETF (HDG) provides exposure to hedge funds. And here's one for those of you who like fishing: Global X Fishing Industry ETF (FISN). I don't know how the ETF will perform, but you've got to love that ticker.
Some of these new funds are ridiculous. Most of them are marketing ploys by financial firms to lure more money from investors. Companies love to launch and promote "new and improved" products. Every year, Frito Lay comes out with a bunch of new flavors of Doritos chips. M&M now makes its chocolate candies with pretzels inside. Some new products catch on, but many newfangled ideas flop. Remember New Coke? That was a classic flop.
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There Is No Perfect Investment
Tweet Share on Facebook August 2, 2011 Comment (1)As the media frenzy around the debt ceiling talks continues to raise the hackles of even the most self-possessed investors, the lure of finding the so-called "perfect" investment has become increasingly popular. Investors look to find that special investment that will protect them from the markets' fluctuations, while still providing growth opportunities. Financial experts are quick to offer an opinion to get you to buy one product over another, but the pursuit of finding the perfect investment resembles the search for the pot of gold at the end of the rainbow.
Focusing on finding the perfect investment could have a far larger effect on your retirement security.
