climbhoser

So, what would you do? I just changed employers and my old 401(k) is no longer tenable, so I can either roll it or take the distribution. Obviously the tax consequences would be big (I'm nowhere near 59 & 1/2 and not interested in a 72(t)). I don't have much in this account, but enough to get me a nice, new bike with SRAM Rival. The account is down a bit, of course, but surprisingly not much thanks to a wise allocation in some cheap investment options.

Thing is, I can roll it into a Roth and buy my company's funds at NAV, which would be a smokin' deal. What would you do? Buy funds at NAV or buy a new bike and lose some value in your retirment accounts?

Wested

Retirement is for old guys in Florida.

Remember what Hemingway said... "Retirement is the ugliest word in the language."

slickyricky

You should know better asking around for solid financial advice on a site where people spend their retirement funds on annual gear upgrades.

robvas

Roll it into an IRA. You'll get a FBO check and it will be in the full vested amount of your plan. You won't get any tax penalties. Call your financial advisor, it's a very simple process.

It might only be $5,000 right now, but in another 30 years when it's time to withdrawl, it'll be much, much more.

SKYLAB

tough dilemma.....if keeping the funds puts you much closer to actually retiring (when you can ride that much more) then I'd say hang on to 'em. If not? then go for the gear. It doesn't sound as if there's really that much in it right now....but, if you're a long ways away from retiring then those funds will have a chance to grow into something substantial - like 3 months on cote d'Azur. Or a month biking the Dolomites. Or Scotland.

Farby

Roll it.

bring44

Wu-Tang Financial says "Diversify yo bondzz!"

subframe

roll it, obviously.

ehidle

Roll it...

DataJunkie

Roll it into an IRA

TromboneAl

My only regrets at retiring at 52 is that I didn't do it earlier. Better to have more time to ride than a new bike to ride. Roll.

cuski

Flip it.

climbhoser

robvas,

I know what'll happen. I've got a Series 7, 63, 65 and am a Level I CFA Candidate. My whole family's in advising.

I'm young, have a long way to go, and other accounts (Roth, pension plan with my new company, 401(k) too) and this account is pretty minor. Think I'll roll it anyways, more because liquidating now means taking a value loss. If this was a bull market I think I'd be tempted, but it's a bear of a bear and it's probably wiser to let my investments recoup some value.

Thanks for the "roll" backers.

kensuf

Roll it. Just think about how great the frames and groupsets will be when you retire.

flip

Okay, i'll be an enabler for the schwag purchase:

I don't know your current riding habits but if the new bike from the 401k funds increases your riding a great deal, one could argue that it is worth more than the retirement fund itself. This assumes you have other financial avenues for your retirement of course. i.e. Using the money now for something that keeps you fit into your retirement years may be more beneficial than money when you retire (assuming you don't forego all other longterm financial plans). This didn't sound like your sole plan.

This argument doesn't fly if you already ride regularly.

Could be a stretch but it is another way to look at it.

climbhoser

Fixed it for ya.

climbhoser

Yeah, I already ride regularly...and have many, many bikes. I just like more! Thanks for being the enabler, though. The roll is done, all I need now is a quick sig guarantee from my bank and I'll have the #1 small/mid value fund there is at NAV!

daoswald

Never, under any circumstances, take a distribution from a retirement account before 59.5. If you do it once, you'll do it again. The day will come where you'll be sorry you did. That is what all financial planners will tell you.

dark13star

+Infinity.

Save elsewhere for your new bike and roll that money. This is the worst place possible to ask financial advice. I am just surprised the booze and hookers response hasn't come up yet.

CastIron

Personally, I've chosen 'good enough' in bike schwag and decided it's smarter to fund an early retirement, thus being able to ride more. Or you can hang a nice bike on your office wall when you're 70.

DataJunkie

+ Infinity +1

I did it once to purchase my home. Never ever again. What a stupid decision. If you consider the potential earnings I lost.... ugh

CharlieWoo

You're gonna pay a 10% penalty to the IRS right off the bat. Makes that bike pretty expensive. Keep yourself invested for the (inevitable) upturn.

AngryScientist 

booo on all the "roll it" advocates.

you're not gauranteed to make it to retirement, buy a nice bike, spend the rest on hookers and blow. live it up.

merlinextraligh

It's insane to cash out your 401k.

Considering the tax consequences, and the long term loss of investment gains, you'd be much better off using a credit card to buy the bike. Of course you'd be even better off saving until you could pay cash.

Right off the bat you lose 10%, then you pay taxes on the full amount at your highest marginal rate.



Also, if your 401k was all in your company's stock you need to diversify.

H82GOSLW

Did you make the original post just to subsequently talk about having a Series 7 etc. and that your whole family is in advising? You obviously knew what you were going to do, so why make the first post? Too much free time?