Any Finance Guys out there ???

[txav8r]

We used to have both defined benefit and defined contribution pensions, but they were frozen/terminated by the company in bankruptcy, distributed, and a new plan was developed. We get a flat percentage of what our annual earnings are. No requirement to put anything into the 401K to have the percentage deposited monthly. So some companies do still do things like this. A match is incentive based, meaning that if your not willing to save, then the company has no requirement to help you. All of these programs are benefits meant to entice and retain quality employees in a competitive world. But the last 10 years have taken a toll on these programs in many companies as they tried to trim cost and improve ROI.

I agree with the above, professional management of this kind of money is necessary. I know you will hear many say you can do this yourself, and if you are financially and investment astute, you could. I can't seem to do that and I have many friends and family members that lost huge amounts of their 401K value in the past years. A balanced and diversified approach is a better plan long term, whether you manage it yourself or have a professional doing it for a percentage of account value. It sucks to pay a dime of your money for management, but it beats losing in a bad emotional decision. I have mine managed...and I have 6 years and 17 days until I have to depend on it to provide for my wife and I the rest of our lives...if I can maintain my medical qualification that long!

 

[Murf'n'surf]

What kind yearly cost is involved in having someone manage your 401 or whatever retirement vehicle one might have?

 

[Geiger41]

For my wifes 403B, the choice as to where the money goes is not hers. (Unless she opts out and pockets the cash via her check). Her company (Atlanticare ) has Metlife run the program and invest the cash in one area with no option to change what fund it goes into . She was automatically signed up to the 403b when she was hired and the company had her at 3% of salary contribution, then whatever that amount is, the company matches %25 (Up to a max company contribution of $4000per year) So after doing research the last few days and talking to the old timers at work (like @OCMD ) we are going to put 16,000 a year into her 403B and get the 4000 on top of that from her employer. This will last 15 years starting March 1st. (666 per check will put her a 16 k) She can take the money out penalty free at age 59 1/2. Obviously if an emergency happens she can earlier w/o penalty (depending on the emergency per irs). But hopefully well sit on it for as long as possible.

For my job (Five-OH) I will have my pension starting May 2nd, 2030 at 00:01 hrs (Countdown widget is on my phone). I shouldnt have any bills at that time except your normal ones (Gas electric taxes).. So the pension will be basically petty cash and fun money

SOOO I decided I will be doing the deferred comp also starting March 1st. $500 per check until I retire. Its a big nut on my check but with the wife doing Neurosurgery, I can swing it.


Im hoping that between my pension, her 403b, and my deferred comp that once im done, I am done. And live off these 3 funds for however many years.

Maybe @OCMD maybe you can get a retirement gig checking the psi on the redskins footballs !!!

 

[Big Shasta]

Curious...does anyone's workplace match 100% on their 401k?

My company matches 100% up to 5% of my income. A small business with ~65 employees. I put in more than 5% but I also have a Roth for me and my wife through vanguard. The returns have been unreal in those vanguard accounts.

 

[Shuck Water]

@Shuck Water "You can do much better managing your own investments" Can you enlighten me on this a little more ???

Everyone else chimed in, but I was referring to an IRA where you can choose the investment funds. I know folks are saying to talk to a professional (which is very wise) but take their advice with a grain of salt. If these professionals are any good they end up working with ultra high net worth individuals, NOT us common folk. We get the B team. There are enough useful free research tools via fidelity, Charles Schwab, etc., that you can make just as good, if not better, decisions on your own investments. Personally, I have a managed portfolio and one that I manage myself, and for the last 2 years I've out performed my CFP. Guess who's getting fired in a couple of weeks.

 

[Noko]

One, don't listen to anything Suzi Orman says. She's a poor financial advisor. She makes her money off of books and DVD sales. I would talk to a tax attorney or and investment advisor but I would not pay long term for either to manage my money. I've seen too many friends get screwed by someone else managing their money. There really isn't much to do to manage your savings once you find the right investment plan to use. I use Vanguard which is offered through my company and have done at least 10% or better over at least 10yrs. I did loose in 2008 like most people have but since then its been pretty good. I don't move stuff around but let it sit. The one thing you need to look at and may have done, is what are your expenses going to be when you retire and what do you want to do? People think in retirement that they don't need the same amount as when they were working but retirement costs can be as high as 80% of what you make now. You also have to look at health insurance costs if you retire at 60. 15 years to save for retirement isn't that long of a time for your money to grow. There are lots of IRA and 401K calculators on the Internet that will give you a pretty good idea of what you will have in 15yrs. The big guess is how long are you going to live. There is the possibility you could outlive your retirement savings if you live long enough. If you look at having 1 million when you retire and making 10% off of that, that about 100K a year. IRS takes about 25% so you end up with 70K. 70K may be alot for some and not enough for others. I would put as much as you can possibly afford now into whatever retirement plan you decide on. Good Luck!