IRA vs. 401K

Reba said:
Yeah, my 401k money disappeared. The money I invested is gone. My account shows a zero balance, and there's nothing I can do about it. :(
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we are waiting for you tell me what the hell is happening? Obviously, you made a huge mistake but what is it?
 
DefMATRIXense said:
we are waiting for you tell me what the hell is happening? Obviously, you made a huge mistake but what is it?
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Man, Reba is only have temp job (interpreter in anywhere), that don't offers 401k as well.
 
DefMATRIXense said:
we are waiting for you tell me what the hell is happening? Obviously, you made a huge mistake but what is it?
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I wish I knew.

My company started deducting my pay for my 401k payments. Then, one day, the boss announced that there weren't enough people participating, so they were quitting the deduction plan. If the employees wanted to continue contributing they could do it themselves. I didn't make any more payments but I thought the money that I had already invested would at least still be in my account accruing interest. It wasn't a huge amount but it was a nice little extra for my retirement some day.

Then I decided maybe I should move it into an account that I could monitor better. When I checked on my balance, it was zero! The reason stated was that my account was no longer vested, so it just drained out. :( If I had known that that would happen, I would have taken my money out a long time ago. But now it's too late.

It was a big waste of my money. I got absolutely nothing for it. I could have done better just putting it in the bank.
 
Pacman said:
Man, Reba is only have temp job (interpreter in anywhere), that don't offers 401k as well.
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Right. I don't have a 401k or IRA available to me now. I work for a small agency, part time, that offers nothing. I also do freelance work, which of course has no benefits. My pay is very "iffy". Some weeks I make good money, and some weeks I make zero. I never know what to expect.
 
I noticed once a while in the past that SEC does not allow middle-class investors to make more money such as one million dollars for example. Typical, the SEC has a way around to make the investors to lose big bucks. It is just almost like a lottery that has a program to eliminate the numbers from people who chose the numbers to win the lottery. I know that I could be ridiculous for me to say that. You may never know about it until one day hit a biggest lawsuit. I don't know if it is similar to 401K/IRA because it is almost like a gambling - like people lose their money or gain it.
 
webexplorer said:
I noticed once a while in the past that SEC does not allow middle-class investors to make more money such as one million dollars for example. Typical, the SEC has a way around to make the investors to lose big bucks. It is just almost like a lottery that has a program to eliminate the numbers from people who chose the numbers to win the lottery. I know that I could be ridiculous for me to say that. You may never know about it until one day hit a biggest lawsuit. I don't know if it is similar to 401K/IRA because it is almost like a gambling - like people lose their money or gain it.
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:stupid:

This is simply not true.

401K and IRA are investment accounts designed by the government for the working class to build wealth for retirement.

You can only open a 401K through a company that you work for. Your annual maximum contribution is $15,500 dollars. Some employers will match a percentage of your contribution and this money is considered pre-tax income which will lower your current taxable income by a big margin. When you retire at 59 1/2, the money is taxed.

There is a new 401K account called Roth 401K. Where your contribution is taxed at your current year, but grow tax free when you take them out at your retirement.


IRA accounts can be opened at any bank or investment brokerage company. Your annual contribution is $5,000. You can choice between traditional or Roth IRA.
 
Company match is good deal for a 401K plan, if you want to stick wih 401k plan. You make your own contribution, your company matches that amount (you get twice the money you are contributing to your 401k). Free money!

Suze Orman breaks down the retirement funds pretty good. Suze Orman internationally acclaimed personal finance expert : The Suze Orman Show : Will & Trust Kit : FICO Kit : Insurance Kit : Women & Money

I'm starting my Roth IRA soon through Fidelity (hopefully), as I feel it's the best for me. Whatever plan you decide on.. the sooner you get started, the more money you have in the end.

That is very unfortunate, Reba! I don't understand. Was it simply bad management or just bad luck?
 
Difference between IRA and 401k: What's the difference between an IRA and a 401(k)? | Answerbag

A 401(k) is an employer-sponsored plan. That means that it is a benefit provided by an employer to employees, and allows the employee to divert some of his salary into it. That portion will not be considered part of the employee's taxable income. In other words, that employee earned a lower salary than he really did for the purpose of calculating taxable income. The portion of salary that got diverted into the 401(k) goes into an account that gets invested in different ways, usually into mutual funds. Those investments grow on a tax-deferred basis, meaning that the year-by-year growth of the investments is also not added to anyone's taxable income. It only becomes taxable when it is withdrawn. Most employers will throw in a contribution to their employees' 401(k) accounts as an added benefit, by matching employees' contributions dollar for dollar, up to a point.

An IRA has almost nothing to do with your job. It's set up by you and no one makes the decisions about how it is invested except you (unless you authorize a financial advisor to manage it for you). What makes an IRA special is the fact that the government agrees to give favorable tax treatment to your contributions and/or to the growth that accrues in the investment. This favorable treatment is long and complex in its details; there are Traditional IRAs and ROTH IRAs and there are a zillion ifs and buts about different situations.

How they are similar: They are both tax shelters for retirement investing.
How they are different: One is a benefit at work and managed by a contractor called a custodian (employer-sponsored) and the other is totally up to you to create and manage (self-directed).

Having both at the same time is possible but iffy. Check with an advisor who knows you and the particulars of your financial life if you want to get into that. There are no decent get-rich-quick schemes but these are good get-rich-slow schemes, so have at it and good luck.
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Reba said:
I wish I knew.

My company started deducting my pay for my 401k payments. Then, one day, the boss announced that there weren't enough people participating, so they were quitting the deduction plan. If the employees wanted to continue contributing they could do it themselves. I didn't make any more payments but I thought the money that I had already invested would at least still be in my account accruing interest. It wasn't a huge amount but it was a nice little extra for my retirement some day.

Then I decided maybe I should move it into an account that I could monitor better. When I checked on my balance, it was zero! The reason stated was that my account was no longer vested, so it just drained out. :( If I had known that that would happen, I would have taken my money out a long time ago. But now it's too late.

It was a big waste of my money. I got absolutely nothing for it. I could have done better just putting it in the bank.
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This sound fishy. To me it sound like company scammed you. Poke around and ask about that money. Why is it Zero balance. I have not heard any of those situation. Unless someone stole your money. That only way to lose the money if someone steals. That what I am seeing here.

Correct me if I am wrong about this.
 
Liza said:
Company match is good deal for a 401K plan, if you want to stick wih 401k plan. You make your own contribution, your company matches that amount (you get twice the money you are contributing to your 401k). Free money!
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Unfortunately, my company did not invest anything. It was all my money.


...That is very unfortunate, Reba! I don't understand. Was it simply bad management or just bad luck?
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My company quit depositing my contributions, so my account become "not vested", and it became zero. The money that I had contributed was used up.
 
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