Financial Advice Needed, Part 2
So I guess cashing out my pension is a bad idea. That seems to be the gist of the response from those that I've heard from. Mark, I like where your head is at, but you're in the minority on this one.
(Don't worry, I'm sure I can find a bit of severance to tuck away for some strippers).
So now, the second question, and this is a bit more open-ended; what should I look for when it comes to choosing an IRA? If it's not apparent enough, I'm a dolt when it comes to investing money; I have been all my life. I'm starting to read a bit more about IRA options, but I'm interested in hearing from those who know about this than I do. And Mark too.
Is there a particular bank or firm that offers an IRA that's significantly better than other options? How do you feel about the standard IRA vs a ROTH IRA? Or is it not to late to change my mind, cash it out, let it ride on black and hope for the best? Let me know.
posted by Matt at
11:13 AM
1 Comments:
IRA basically lets you manage the money. There's no "better deal" from one company to another for an IRA. You just set it up and get started. However, having said that, I'd say go with an online brokerage account. You don't need a broker that charges you ungodly fees and stuff. Charles Schwab and Etrade are two that I have accounts with and am very happy with.
If you want to learn more on the basics, go to money.cnn.com. Under personal finance, you should see a lot of good articles.
As for Roth vs traditional IRA, I always recommend ROTH for the younger people just because your earnings are tax free. And that is huge. So, over the course of the lifetime, it's very likely that this amount will grow tremendously. When you cash out, it's tax free. That's huge compared to the traditional where you get the tax break now, but will be taxed later.
But this depends on how your pension was. So, you might just want to check with your coworkers on what they are thinking about doing. But another thing is if you have a question, just call up the 1-800 number for schwab or etrade. You will be amazed as to how helpful they are, even to a financial newbie. They might ask you some questions that you might not know about your pension but you can always ask whatever dept that's in charge of those things to find the answers.
Trust me, in the long run, setting up an IRA account is a much better play. Just keep chipping away on the credit card debt. But set up the IRA now.
By
Alan aka RecessRampage, At
February 20, 2008 at 2:09 PM
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