I had 20 years. I rolled over my lumpsum to 401K and currently it is at $1.2 million. I am almost 56. Total retirement savings including spouse's retirement is about $2 million. Spouse is 52.
How do I compare to rest of you? just to see how deep of a water I am in.
I did find a job. I humbly took a small paycut, but earning a modest six figure salary.
I agree with @5hag:
+ Changing jobs is a golden opportunity to roll over a 401(k) to an IRA. You have a choice of moving it to your new company 401(k) but in a 401(k), you will be limited to fewer investments compared to an IRA.
@3wfc+1oNm2XLp You can roll it over to a new job 401K, but you probably should roll it over to an IRA at Vanguard or Fidelity. An IRA has more investment options and less fees. The only time you want to leave your money in a 401K is if you retire from the company that you have the 401k with between the ages of 55 and 59-1/2. There is a RULE 55 that allows you to withdraw funds from the 401K without paying the 10% under age 59-1/2 government penalty (you need to be at least 55 and be retired from the company that has the 401K ) . If you plan on retiring after age 59-1/2, you really should open an IRA at Vanguard or Fidelity and rolling your money over to it. There are thousands of investment options in an IRA. Plus a lot of 401K's have limitations on withdrawals and fees associated with the withdrawals, etc. They also are required to take out 20% in federal taxes regardless of your tax brackets. You don't want to leave your money in a 401k
"401K-pre tax should be rolled it over to IRA account only. No taxes no issues. Much better choices with Vanguard. I got 1/2 of it now in T-Bills @ 5.5% APY and 1/2 of it in a Vanguard index fund."
Couldn't I simply roll my 401K-pre tax into a Vanguard 401K account (assuming that this won't trigger a tax event) instead of into an IRA? Also, I am 49 years old and after doing some research, I was told that there is a way that you can tap into your 401k if you transfer it to another 401K (I assume this is correct?). Also, what happens if I get a position with another company that offers a 401K program. Would it make sense to roll it over there or have to 2 separate 401K accounts (Vanguard and new company)??
Thanks for any suggestions. I am new to this kind of stuff.
Thank you for posting and sharing your info! I was SIRP'd last August with only 16 years = no pension. Started 2 years after they stopped handing them out. Been kicking myself for the last year for not getting the pension (I worked with Ford on the outside and had many opportunities to switch) but now I hear for the 1st time that realistically I only would have gotten $400k-$450k I don't feel so bad!!
FYI, I'm 60 and back in Jan '22 I had $525k in my Ford 401k, my wife had $575k in her work 401k and we had another $1.1m in IRA's and other investments, so just over $2m total. Unfortunately because of Bidenomics we're down about $200k to $1.8m now and I decided to find another job instead of retiring.
Checkout Bogleheads.com and Humbledollar.com for some common sense advice and best of luck to you!
@2fjs+1oNm2XLp - Yes, straights froward, BUT... don't do it online! Do the request over the phone and ASK for overnight check to Vanguard. It will cost you $20 but it is much better than snail mail (default).
401K-pre tax should be rolled it over to IRA account only. No taxes no issues. Much better choices with Vanguard. I got 1/2 of it now in T-Bills @ 5.5% APY and 1/2 of it in a Vanguard index fund.
Good Luck.
I assume it is best to roll your Ford 401K into a Vanguard product (or the like)? Is this a straight forward process and anything to avoid in order that a tax event is not triggered?
Also regarding benefits (dental, health,...), I assume you now have to pay out of pocket until the severance time is over?
No kids I presume?
@1cva+1oNm2XLp - How about stamps?
Sounds good for 20 yrs.. at 33 I had around 3M. We tried to do the max every year but sometimes came up a little short. I always got company match. My wife and I also did Roths when they started so we tried to save as much as possible.
Vanguard has .3% fee for their investment service.. 600K in my 401K and rolled the rest to Vanguard. We are taking from the 401K until I reach 59 1/2 and then everything goes to VG. My 401K is on auto re- balance with investment recommendations from the online Financial Engines suggestions.
Contributory went into a Roth.
You,’ve got 3.2m, you’re good to retire on 3-4% safe withdrawal rate.
Calculate your cost of living to this fraction.
If you pay a financial advisor 1%, consider that is a tax on your 3-4% withdrawal rate.
20 year lump sum, probably is 450-550k for GSR8 after 20 years of service, including 23%drop after last November.
I am assuming your 1.2m is 401k plus lump sum.
@1snk+1oNm2XLp is a troll.
This troll thinks he is smart and witty. People know there is contribution limit.
Lots of trolls lately...
@1snk+1oNm2XLp — how old were you when you started contributing to your 401k?
I am 25, have 550k in 401k
@1shf+1oNm2XLp - okay, that makes sense...
$1.2M and total $2.0M (with spouse). Your #1 concern should be health care. If you can get it with minimum cost, then you're in good shape.
Good Luck
I said I have $1.2 million. 750k in 401k and rest 450k rolled over in pension lumpsum.
20 years with 1.2 lump sum?! Nope I don't buy that figure.
Last year, a freep article interviewed few people who decided to leave (before interest rate hit. I recall one person, a GSR8 with 33 years of service and was getting $1.35M.
That depends do you have a mortgage?
OP: You are doing well, probably better than most.
Are your expenses less now, compared to before?
Umm.. nowhere near where you are. No pension for me. I started after those glory days. We’ll be eating potted meat and saltines when I’m either laid off of retire. Enjoy what you have, my friend.
Ladder CD's. 1, 2, 3, 4, 5 year CD's (equally distributed) on a rotating basis. Keep rerolling the newly expiring CD into a new 5 year. Distributed among multiple financial institutions under the 250k limit.
You would secure more than enough to live off of annually - comfortably. No gambling in the markets required.
I am X-X with $144Million in the market...Once we layoff another 7500, they will give me another bonus of 10 million from the treasury....good deal yah
The horror! How are you going to survive!
Sounds pretty good for you.
The lump sum payout was better when I did it last spring.
I'll probably need to grab a new job soon, too. I'm 58.
They legalized canabi$$ in my state this year, so I'm out of that side income.
$2 million? I'd be out at 59 1/2!
Please clarify... is $1.2M a combined lump sum and 401K?
Im 28 and have about 150k in my 401ks and retirement so im screwed
Ur ahead of me.
Lookup the 4% rule. If you can live off ~$80k per year you can retire today. Nice nest egg!
I'm 29 at about $330k. My goal is 2-2.5m by 40 and retire.
About the same here.
If the stock market collapses, you'll be glad you have that job.