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chefCarlo · 07-20-2006, 05:15 AM

I just changed jobs and the new employer does not offer a 401k plan,i have around 300,000 in a 401k from the previous job, i'm 55 yo and would like to retire at 62, i've talked to some financial advisers and they are recommending i put it in a varible annuity. i would like to get the best return possible with the least amount of risk, i know i will have to take a certain amount of risk to make any money. any good advice?

BOB+ · 07-20-2006, 05:15 AM

No, don't put it in an annuity. The only purpose of an annuity is to shield is from income taxes. But you can achieve the same result by rolling over your 401(k) into a traditional IRA. An annuity has commissions, high fees, and a death benefit that you pay for out of the investment return.

Contact several of the major investment companies and talk to them about rolling over your 401(k) and your financial goals and they can tell you how to do it and recommend appropriate investments to meet your goals. T Rowe Price and Vanguard are the two companies that come to mind.

DrTrade · 07-20-2006, 05:17 AM

Annuities only make sense if you're selling them Smile. Planners push them because they get their entire commission up front, which also comes out of your return.

Figure out how much you'll need for retirement. Search the web for "retirement tools" and you'll find help with this. Your 401(k) web site may also have these resources. You may not need to take as much risk as you think to reach your goal of retiring at 62. But in any event, it's important to know where you stand before making any big decisions.

bill_gatez · 07-20-2006, 05:18 AM

You cannot make a blanket statement that variable annuities are bad. there are some bad ones out there. The fact is fee-based planners cost more than variable annuities do, period. Variable annuities sales people make less, even with a bigger upfront commission than a fee-based planner. With living benefits that guarantee income in the future, without annuitization, it makes more sense to look at variable annuities. They are not right for everyone, but man they sure are not just to shield your investment from income taxes now a days.

titan22 · 08-16-2006, 12:33 AM

you need to roll over your 401k though. put it into a traditional ira. if you die before you roll it over, it will pass to your beneficiary taxed at ordinary income. which could be a possible hit of 40%. find a good advisor and put it into a traditional. the annuity would be good as a PORTION of your investments. but it would basically give you a monthly pension when you are ready to use it.

07-20-2006, 05:15 AM	#1
chefCarlo Greenhorn Join Date: Jul 2006 Posts: 16 Rep Power: 0	401k Rollover I just changed jobs and the new employer does not offer a 401k plan,i have around 300,000 in a 401k from the previous job, i'm 55 yo and would like to retire at 62, i've talked to some financial advisers and they are recommending i put it in a varible annuity. i would like to get the best return possible with the least amount of risk, i know i will have to take a certain amount of risk to make any money. any good advice?

07-20-2006, 05:15 AM	#2
BOB+ Piggy Bank Join Date: Jul 2006 Posts: 96 Rep Power: 6	No, don't put it in an annuity. The only purpose of an annuity is to shield is from income taxes. But you can achieve the same result by rolling over your 401(k) into a traditional IRA. An annuity has commissions, high fees, and a death benefit that you pay for out of the investment return. Contact several of the major investment companies and talk to them about rolling over your 401(k) and your financial goals and they can tell you how to do it and recommend appropriate investments to meet your goals. T Rowe Price and Vanguard are the two companies that come to mind.

07-20-2006, 05:17 AM	#3
DrTrade Greenhorn Join Date: Jul 2006 Posts: 35 Rep Power: 6	Annuities only make sense if you're selling them Smile. Planners push them because they get their entire commission up front, which also comes out of your return. Figure out how much you'll need for retirement. Search the web for "retirement tools" and you'll find help with this. Your 401(k) web site may also have these resources. You may not need to take as much risk as you think to reach your goal of retiring at 62. But in any event, it's important to know where you stand before making any big decisions.

07-20-2006, 05:18 AM	#4
bill_gatez Savings Advisor Join Date: Jul 2006 Posts: 132 Rep Power: 6	You cannot make a blanket statement that variable annuities are bad. there are some bad ones out there. The fact is fee-based planners cost more than variable annuities do, period. Variable annuities sales people make less, even with a bigger upfront commission than a fee-based planner. With living benefits that guarantee income in the future, without annuitization, it makes more sense to look at variable annuities. They are not right for everyone, but man they sure are not just to shield your investment from income taxes now a days.

08-16-2006, 12:33 AM	#5
titan22 Super Moderator Join Date: Aug 2006 Location: West Coast Posts: 773 Rep Power: 7	you need to roll over your 401k though. put it into a traditional ira. if you die before you roll it over, it will pass to your beneficiary taxed at ordinary income. which could be a possible hit of 40%. find a good advisor and put it into a traditional. the annuity would be good as a PORTION of your investments. but it would basically give you a monthly pension when you are ready to use it.

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