I have been thinking about cashing in my 401K in order to fund my new life overseas. I know will lose maybe half its value to the IRS. Has anyone on this board done this. What are the pros and cons?
Mark
Cashing in my 401K
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momopi
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Re: Cashing in my 401K
http://en.wikipedia.org/wiki/Self-Directed_IRAMarkDY wrote:I have been thinking about cashing in my 401K in order to fund my new life overseas. I know will lose maybe half its value to the IRS. Has anyone on this board done this. What are the pros and cons?
Mark
Re: Cashing in my 401K
Do you need to cash it out? You can transfer a corporate 401K into a regular IRA, w/o penalty, and then, withdraw money periodically, paying the IRS its 10% penalty per withdrawal, and letting the rest sit and collect dividends/capital gains. The assumption here is that you have an investment strategy in mind.MarkDY wrote:I have been thinking about cashing in my 401K in order to fund my new life overseas. I know will lose maybe half its value to the IRS. Has anyone on this board done this. What are the pros and cons?
Mark
The key here is that wherever you are in the world, you can use the IRA shelter to build up a tax deferred portfolio till your natural retirement age. It's not a good idea to ever give that up, esp if you find a market space which is bullish or if a bear, a market, where you can use short EFTs or futures, to build up the balance sheet w/o paying taxes on the accrual.
I would absolutely cash in a 401K. I got 40 ounces of silver when it was $7 an ounce. Silver is projected to hit $200 a ounce in the next year or two.
Gold...well, lets not even go there. Take the cash now while the US dollar is still worth something. Once oil hits $200 per barrel meaning $7 per gallon, the dollar may well be dropped as the worlds reserve currency.
Gold...well, lets not even go there. Take the cash now while the US dollar is still worth something. Once oil hits $200 per barrel meaning $7 per gallon, the dollar may well be dropped as the worlds reserve currency.
How to deal with newbies that talk much but do little.
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Think Different
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This has been my main concern with maintaining my Roth and Traditional IRAs in the US, too. Even if they maintain a good level until my retirement, my fear is that the dollar's value will drop so much in relation to other world currencies, that it won't actually benefit me much in retirement. As Grunt said, if the dollar loses its status as world reserve currency (which is likely to happen), then hyperinflation will take hold when all the nations start dumping their US Treasuries and asking for their money back in $$$. Well, the US doesn't have the currency to pay that back, without printing a ton more money (QE3 and QE4). That will devalue the dollar a' la Weimar Republic (wheelbarrows of cash, anyone?).Grunt wrote:I would absolutely cash in a 401K. I got 40 ounces of silver when it was $7 an ounce. Silver is projected to hit $200 a ounce in the next year or two.
Gold...well, lets not even go there. Take the cash now while the US dollar is still worth something. Once oil hits $200 per barrel meaning $7 per gallon, the dollar may well be dropped as the worlds reserve currency.
What good is having a hypothetical $300K, when a loaf of bread costs $50? I've already put the rest of my savings into cash and plan to buy gold/silver and diversify into other hard currencies, once I'm abroad.
Of course, I'm no financial guru (who is, anymore, after what we've seen happen to the economy?), so if those more knowledgeable about this have better ideas, please share your thoughts.
Gold and silver.
Anything else is purely speculative, and thus anyone that engages in it should do so with the full knowledge that you are basically playing Vegas odds.
And in the end, the house never loses.
Anything else is purely speculative, and thus anyone that engages in it should do so with the full knowledge that you are basically playing Vegas odds.
And in the end, the house never loses.
How to deal with newbies that talk much but do little.
Pics or it didn't happen.
YES/NO
Cool story, bro.
Problem solved.
Pics or it didn't happen.
YES/NO
Cool story, bro.
Problem solved.
Well, all i can say is that i don't think anyone needs to worry about other currencies taking over as the reserve currency. Nothings really close to the dollar in reserve capacity.
Thing is, we are still the worlds dominant consumer...until that changes, we will remain the reserve currency. The debt we owe is paid in US currency. That means that is the debt/reserve that other countries will hold. We have the leverage to pay out in whatever currency we choose, or they can take their business elsewhere. And they won't.
Now, if China ever becomes the largest consumer instead of manufacturer, then it'd be another story entirely. And a mass 'cashing out / dumping' of US currency reserves would have a bad side effect of diminishing the value of the dollar. For those who hold the reserves, they don't want that either.
As for 401k, i'd liquidated mine long long ago. I had a high risk portfolio. Lots of gains until it blew up in my face during the tech stock collapse around 2000. I've always been a gambler by nature when i was younger.
Way i look at it, it's all a gamble anyway, cause it really is. I knew i should have bought gold back in the day but i was working for corporate America and just did what everyone else did. It hasn't always worked out.
Like you said, you can't trust any financial gurus anymore. Just how many of the so called experts have been wrong in the last 12 or so years. It's been a real rocky ride. I'd just do what you feel is safe for you. If you really plan to bail the US, just don't take unnecessary risks with your stash until you have some kind of means to support yourself.
Thing is, we are still the worlds dominant consumer...until that changes, we will remain the reserve currency. The debt we owe is paid in US currency. That means that is the debt/reserve that other countries will hold. We have the leverage to pay out in whatever currency we choose, or they can take their business elsewhere. And they won't.
Now, if China ever becomes the largest consumer instead of manufacturer, then it'd be another story entirely. And a mass 'cashing out / dumping' of US currency reserves would have a bad side effect of diminishing the value of the dollar. For those who hold the reserves, they don't want that either.
As for 401k, i'd liquidated mine long long ago. I had a high risk portfolio. Lots of gains until it blew up in my face during the tech stock collapse around 2000. I've always been a gambler by nature when i was younger.
Way i look at it, it's all a gamble anyway, cause it really is. I knew i should have bought gold back in the day but i was working for corporate America and just did what everyone else did. It hasn't always worked out.
Like you said, you can't trust any financial gurus anymore. Just how many of the so called experts have been wrong in the last 12 or so years. It's been a real rocky ride. I'd just do what you feel is safe for you. If you really plan to bail the US, just don't take unnecessary risks with your stash until you have some kind of means to support yourself.
Add to it the major brokerages are pumping stocks to the investors, while simultaneously dumping the very same stocks in the back room.
Imagine how rich you would be if you had cashed your 401k in for gold and silver 10 years ago? Roll over your profits every few years for some new bullion, and your looking at a nice little nest egg.
Never forget, gold is the mountain all paper currencies are trying to climb.
Imagine how rich you would be if you had cashed your 401k in for gold and silver 10 years ago? Roll over your profits every few years for some new bullion, and your looking at a nice little nest egg.
Never forget, gold is the mountain all paper currencies are trying to climb.
How to deal with newbies that talk much but do little.
Pics or it didn't happen.
YES/NO
Cool story, bro.
Problem solved.
Pics or it didn't happen.
YES/NO
Cool story, bro.
Problem solved.
Folks, are you sure that you can't use a self-directed IRA to buy gold/silver, and not just the precious metal ETFs of GLD & SLV?Grunt wrote:Imagine how rich you would be if you had cashed your 401k in for gold and silver 10 years ago? Roll over your profits every few years for some new bullion, and your looking at a nice little nest egg.
Never forget, gold is the mountain all paper currencies are trying to climb.
Then, you've got the PM appreciation and can also diversify w/o a tax hit whenever you want.
Remember, if the stock market crashes, & then you buy the high dividend stocks like tobacco/utilities, they'll will be giving 10-15% and that's tax free dividend income in an IRA. That market can hang around the bottom for a decade and you'll still get a nice stream of income out of it. There's no reason to only buy the high cap stocks like Google/Apple for capital gains or low div stocks like Oracle, crash or no crash, just to play the tech sectors like it was 1999.