A person was telling me today that in an effort to save money he tried to simply cut off some of his activities and would continue to do them one he gets his finances back. however, it doesn’t seem like he is able to do this as from time to time he just ends up [...] …

Replacing Behaviors And Habits

zheka_d asked: Would it be better to use my 401k money for the down payment and closing cost, instead of hard cash. This is not including a bank loan.

I am a first time home buyer. Thank you.Diamond Prices

1st time home buyer. I would like to use my a loan against my 401k which I will be paying back?

Millions of consumers file claims every year against a wide variety of insurance policies only to find the money they spent on premiums was virtually thrown away. here are some types of insurance you can live without.

Jeanette Pavini’s Buyer Beware: Insurance you don?t need: Skip this, buy that

We pick our five favourite cash Isas for savers. this is essential Isa reading and is kept up-to-date throughout the year

This is Money’s 5 favourite best buy Isas

The two things that everyone could use more of are time and money. one way to help free up some of both is by rolling over your existing retirement assets into an Individual Retirement Account (IRA). An IRA rollover may give you greater control of assets spread across multiple accounts and potentially offers improved diversification, flexibility, guidance and service. this could save you money in fees and other costs from different accounts as well as cut down on financial paperwork and other headaches from dealing with multiple assets.

Here are some basics from Thrivent Financial regarding what you need to know about rolling over to an IRA.

What is an IRA rollover?
An IRA rollover is the act of funding an IRA with assets moved from an existing tax-qualified retirement account, a pension plan, a profit sharing plan, 401(k) plan, 403(b) plan or another IRA (with the exception of a Roth IRA, which can only be rolled into another Roth IRA) without penalty or tax withholding, for continued tax-deferred growth potential.

Who can open a rollover IRA?
You can roll over money from a former employer’s retirement plan (profit sharing, 401(k), 403(b), Roth 401(k) or Roth 403(b), etc.) to an IRA if you experience one of the following triggering events as permitted by the plan:
* Change of employer
* Termination of an employer’s existing plan
* Retirement
* Reaching age 59 1/2
* Disability
* Divorce
* Death

You may also roll over or transfer assets from most traditional, Roth, SIMPLE and SEP IRAs into an IRA. The assets in the old plan or account are “rolled over” into an IRA and retain their tax-deferred growth potential.

Why move funds into a rollover IRA?
There are potentially four primary benefits in rolling tax-qualified retirement savings over to an IRA. These include:

1. Easier management of retirement assets. Consolidating multiple tax-qualified workplace retirement accounts into a single IRA may make it easier for you to manage your retirement assets. instead of piecing together multiple statements to find your overall investment performance and balance, just one statement does the trick.

The U.S. Department of Labor reports that baby boomers born between 1957 and 1964 held an average of 11 jobs from age 18 to age 44, according to the National Longitudinal Survey of Youth. that kind of job mobility has the potential to greatly complicate the task of managing your retirement assets. For many, an IRA rollover makes sense to better track and manage your retirement assets.

2. Increased investment options. Rolling over to an IRA may offer more investment options than your employer and plan custodian. more options may help you better diversify your investments or better align your accounts with your risk tolerance. Remember, while diversification can help reduce market risk, it does not eliminate it.

3. Potential tax-deferred compounding. IRA rollovers may offer continued tax-deferred treatment of retirement assets. There are two ways to accomplish an IRA rollover. Request a “direct” IRA rollover from your former employer or an “indirect” rollover.

With a “direct” rollover, the funds being rolled over must be paid directly to the receiving organization, not to you. If the assets are paid directly to the new IRA trustee/custodian, this does not create a taxable event, although it will be reported for tax purposes as a distribution and rollover.

With an “indirect” rollover the funds are made payable to the account owner, and the employer must withhold 20 percent of the withdrawal, which is sent to the Internal Revenue Service for taxes. you would still have 60 days to deposit the rollover into the IRA, as well as an amount equal to the 20 percent if it’s available from another source in order to maintain continued tax-deferral. in addition, if you are younger than age 59 1/2 when the distribution occurred, a 10 percent penalty may be assessed on any amounts not rolled over within 60 days of the withdrawal.

4. Simplified calculation of required minimum distributions (RMDs). Required minimum distributions (RMDs) – the minimum amounts that a retirement account owner must withdraw annually starting with the year that he or she reaches age 70 1/2 or, if later, the year in which he or she retires – must be calculated for a combination of all your tax-qualified retirement accounts. Consolidating retirement accounts into one rollover IRA simplifies the calculation of a required minimum distribution. (Required minimum distributions cannot be included in a rollover IRA.)

Additional factors to consider before rolling your retirement assets over to an IRA include the fees and expenses charged by your employer plan versus those charged by the IRA, as well as the impacts of combining pretax and after-tax assets, the 5-year waiting period for Roth assets, net unrealized appreciation, and early retirement. Consult a tax advisor before making the decision to do a rollover.

Additional regulations apply to IRA rollovers, but knowing a few of the basic principles can be helpful. Rolling over to an IRA may be what is needed to help you more effectively monitor and manage your retirement assets – and dreams.

You can find more information at www.thrivent.com/ira.

<a href="http://www.lvrj.com/sponsored/save-time-and-money-by-learning-ira-rollover-basics-147127655.html?ref=655tag:news.google.com,2005:cluster=http://www.lvrj.com/sponsored/save-time-and-money-by-learning-ira-rollover-basics-147127655.html?ref=655Thu, 12 Apr 2012 11:20:36 GMT”>Save time and money by learning IRA rollover basics

Creating a Spending/Savings Plan

How much money do you make? How much do you take home? How much money do you need to cover your necessary living expenses? are you spending more or less than your take home pay? are you saving for a rainy day? put all your information down on paper, in a spreadsheet, or a software program like Quicken. You?ll be amazed at where you?re money goes and how much you?re spending. Once you make this conscious effort and you pay attention to where your money goes, you?ll be able to make some conscious changes to improve your personal bottom line and save more money.

National Retirement Planning Month – Successful Retirement Living

Janelli asked: I’d like to rollover my 401K from my previous employer, but my current employer doesn’t participate in any 401K programs. I was interested in rolling my 401K savings into a Roth IRA but was told that I would be charged taxes. Is there any other type of retirement saving programs where I can roll my money over and not pay taxes on it?Federal Student Loans

How can I rollover my 401K from my previous employer?

Mom of 2 great boys asked: Is there a difference? please explain in Taxes for dummy form. I have no clue what this all means. all I know, is that I get money taken out, and build a savings. lol

Oh, and when I leave my current employer which I have the 401k, and then go to the new employer which has the 403B, can I take out money before I put it in the new plan? Will I be taxed?Used Car Loans

What is the difference between a 401K and a 403B?

Janelli asked: I’d like to rollover my 401K from my previous employer, but my current employer doesn’t participate in any 401K programs. I was interested in rolling my 401K savings into a Roth IRA but was told that I would be charged taxes. Is there any other type of retirement saving programs where I can roll my money over and not pay taxes on it?Federal Student Loans

How can I rollover my 401K from my previous employer?

(MoneyWatch) Would you be surprised to hear that retail financial advisors often recommend the portfolio that makes the most money for them, not their customers, even if their recommendations result in less money for their clients or make their client’s current situation worse? That’s the damning conclusion of a recent working paper published by the National Bureau of Economic Research (NBER), reporting on an audit conducted by the Consumer Financial Protection Bureau (CFPB) of the quality of financial advice.

The CFPB put together a clever undercover operation in which trained auditors visited numerous retail financial advisors whom the average citizen can access via their bank, independent brokerage, or independent advisory firm. These advisors are usually paid based on the commissions and fees they generate from transactions and not on the assets under management. the audit was carried out in the Boston area in 2008.

The auditors impersonated regular customers who were seeking advice on how to invest their non-401(k) plan retirement savings. the auditors represented two different wealth levels, either those with savings between $45,000 and $55,000 or those with savings between $95,000 and $105,000. the auditors’ goal was to have a savings amount that was representative of that of the average U.S. household in different age ranges. the audit didn’t address the situation of people in the higher end of the wealth spectrum, who usually have access to private wealth managers or fee-based advisors who don’t accept commissions.

The goal of the audit was to determine if the financial advisors would attempt to correct mistakes that individual investors might be making or if they would exploit those mistakes and move their customers toward funds that generate high fees. An important goal of the audit was to estimate the extent to which advisors gave “good advice,” defined as moving investors towards low-cost, diversified index funds, a strategy suggested by many textbooks on investments and one often recommended by my fellow CBS MoneyWatch bloggers Allan Roth and Larry Swedroe.

The auditors presented the advisors with one of four scenarios:

Scenario #1. the auditor expressed a desire to chase returns — that is, to invest in an industry sector fund that had performed well during the previous year.

Scenario #2. the auditor held 30 percent of his or her portfolio in the company stock of their imaginary employer.

Scenario #3. the auditor held a diversified, low-fee portfolio consisting of index funds and bonds — in effect, an efficient portfolio often suggested by textbook theory.

Scenario #4. the auditor held all of his or her investments in CDs and simply expressed a willingness to increase risk for higher returns.

The audit compiled all the financial advisors’ responses and recommendations to the above scenarios. Here are four key findings:

Finding #1. There was a significant bias towards actively managed funds that generate higher fees. In nearly 50 percent of the interviews, the financial advisor encouraged the client to invest in an actively managed fund. Index funds were recommended in just 7.5 percent of the visits. When advisors mentioned fees, they often did so in a way that downplayed them without lying. for example, they would make statements such as “This fund has a 2 percent fee, but that’s not much above the industry average.”

Finding #2. There were differences in the advisors’ level of support for the investment strategy presented by the auditors. particularly troubling was what happened if the auditor presented the diversified, low-cost portfolio scenario: In 85 percent of the cases, the advisor suggested changing the investment strategy. In just 2.4 percent of these visits did the financial advisor support the low-cost portfolio. Since having a low-cost portfolio has been repeatedly demonstrated to be the most efficient way to invest, the advisors’ suggestions would most likely result in lower accumulations for their customers. In effect, the advisors were willing to make a change that could leave their clients worse off.

Finding #3. Advisors were most supportive of the current strategy when the scenario presented was the willingness to chase returns. In more than 19 percent of these visits, the advisor supported this strategy. the cynical interpretation is that this scenario presents an opportunity for the advisor to churn the account, directing the customer to high-cost sector funds. the advisors supported the scenario to hold employer stock in about 10 percent of the visits and, as mentioned previously, almost never supported the low-cost index approach.

Finding #4. One more interesting finding: In almost one-third of the visits (30 percent), the advisors refused to offer any advice until the “customer” actually transferred money to the advisor. while it’s understandable that advisors may not want to offer “free” advice, this situation presents a screening problem for the customers — with no information to go by, it’s hard to judge the value of an advisor before having to commit to the advisor.

Why ‘active’ investment is a losing bet
My dog, America’s top financial planner

While it’s possible that advisors can produce better results for their customers than those customers can produce when making decisions on their own, this study shows there’s a lot of room for improvement at the retail level of financial advice. Hopefully we wouldn’t see these kinds of results from financial planners who are paid only on a fee basis.

Based on the results of this study, here’s my take-away for individual investors:

Ask your financial advisor how they are paid. only use financial advisors who aren’t paid on a commission basis. These type of advisors are available to customers with average wealth levels, although you may need to do some hunting to find them.

Learn as much as you can about investing on your own. even if you work with a financial advisor, knowing as much as you can about investing will help more easily choose a financial advisor. And when you select one who has your best interests at heart, you’ll be able to have more informed conversations with them.

This may sound like a lot of hard work, but you’ll thank yourself later when you’re able to make sound investment decisions and have enough money to enjoy your retirement.

<a href="http://www.cbsnews.com/8301-505146_162-57405746/retail-financial-advisors-looking-out-for-themselves/tag:news.google.com,2005:cluster=http://www.cbsnews.com/8301-505146_162-57405746/retail-financial-advisors-looking-out-for-themselves/Wed, 28 Mar 2012 17:06:01 GMT”>Retail financial advisors looking out for themselves?