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bobwhitesr

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About bobwhitesr

  1. 457 & Child Credit

    Tony, Thanks for the reply. Have you filed taxes and had it work that way? It certainly seems correct as you state it. I just don't want to find out after the fact that I lost my child tax credit. Bob
  2. 457 & Child Credit

    Hi, My gross income is just above 110K and is starting to cut into my child tax credit. I know that tax deferred contributions to a 403b can lower my adjusted gross income in order to get the full child tax credit. Is the same true of the 457? Will tax deferred (pre-tax) contirbutions to a 457 effectively lower my adjusted gross income with respect to the child tax credit ceiling? Also, is it true that contributions I make to my pension plan are NOT counted towards my gross income for the purposes of determining my qualification for the child tax credit? Any help at all is apprecaited. Thank you!
  3. Can I Roll This Over?

    Sorry Joel. I was just being flip. I never even read your "perfect IRA" thread other than the topic heading. It does sound like a good plan. However, I do see a value in being able to take your money out at 59 1/2, no matter what 403b plan you are in and it would have been nice if they had that option. Bob, Do you know why I used the word "irrelevant" in my last sentence? Joel No Frank, as I said I didn't read your post about the perfect IRA because I don't live in NJ and never will. Are you saying that you can take the money out any time you want and you don't have to wait until your 59 1/2? Is THAT your point? I'm dying to know. Bob, you're being "flip" Well, thank you so much for pointing out that your NJ plan doesn't have the 59 1/2. It's been very valuable to this discussion in the same way that a 59 1/2 would be valuable to a plan that lets you take your money out whenever you want. In fact, you've "helped" with many of my threads. Never in the way of actually answering my questions or helping me obtain the information I'm looking for. Usually more in the way of telling me to go look for information that you already know, or telling me to charge a windmill or something like that. In the past I've tried to recognize that you're only trying to help and so I've tried to acknowledge you and be polite which typically gets me more of the same usually from a soap box. It's not that I haven't enjoyed the goose chase of trying to understand the relevancy of your comments only to find out there is none, but I do have a suggestion. Consider that, in the future, if you find yourself in a situation where you are reading a thread where you have nothing of value to add, it's within your options to just not post to it.
  4. Can I Roll This Over?

    Sorry Joel. I was just being flip. I never even read your "perfect IRA" thread other than the topic heading. It does sound like a good plan. However, I do see a value in being able to take your money out at 59 1/2, no matter what 403b plan you are in and it would have been nice if they had that option. Bob, Do you know why I used the word "irrelevant" in my last sentence? Joel No Frank, as I said I didn't read your post about the perfect IRA because I don't live in NJ and never will. Are you saying that you can take the money out any time you want and you don't have to wait until your 59 1/2? Is THAT your point? I'm dying to know.
  5. Can I Roll This Over?

    Sorry Joel. I was just being flip. I never even read your "perfect IRA" thread other than the topic heading. It does sound like a good plan. However, I do see a value in being able to take your money out at 59 1/2, no matter what 403b plan you are in and it would have been nice if they had that option.
  6. Can I Roll This Over?

    "In the 401k world I don't know of any #'s but I would be fairly confident it is way below 50% allow for taking it out @ 59.5." If the government was worried people would take all their money out and blow it at 59 1/2 they should have raised the limit to a higher age. What a boon for high fee 403b plans that can now prevent employees from getting their money out and putting it into a lower fee IRA. J Frank, Then I guess that's not the perfect 403b afterall...
  7. Can I Roll This Over?

    Is that a 403b or 457?
  8. Can I Roll This Over?

    Clearly I don't know much about the account your referring to. I don't even know what SACT stands for. Even so, "Generally" leaves the door open, and couldn't the "due to withdrawal" reference mean exactly the kind of withdrawal we're talking about? Beats me.
  9. Can I Roll This Over?

    With respect to the topic of the thread, how does the SACT plan of NJ make it more restrictive?
  10. Can I Roll This Over?

    Good question. The IRS says you can take out loans and hardships, but individual plans are free to prohibit these options. Is the 59 1/2 clause an option or is it a fundamental requirement of the 403b account itself as created by the IRS? My 2 cents is that it doesn't matter. The very nature of the employer-TPA-employee relationship makes elimination of the 59 1/2 rule implausible.
  11. Can I Roll This Over?

    Yeah they can. The overall plan document can restrict in-service withdrawals if they so choose. The plan doc governs all contracts as part of the plan. Big Red, I can say that the current plan doesn't make such stipulations. I doubt my fellow employees are savvy enough to think to roll their money out at 59 1/2, let alone continue to make yearly transfers after that. If I were doing that regularly would the employer/TPA create new rules and/or fees to dissuade or prevent me from doing that? Well, in most cases there's a TPA involved. So the TPA would have to absorb the hassle of having to do annual transfers which, in terms of manpower may raise their cost of doing business. Also, in situations where the TPA is getting a kick back from the vendor or charging a percentage fee on the balance, any transfers out of the 403b plan and into an employees personal IRA (or an employees pocket) will cost the TPA money. In cases where the employer doesn't use a TPA such kick backs are unlikely so it would just be the hassle/cost of doing yearly transfers. But consider what you are saying (as I understand it). The 59 1/2 stipulation by the IRS is a big deal and a core part of the whole 403b/401k concept. You can get your money out at 59 1/2, but until then you pay a penalty. If you tell the employee he can't take his money out until he quits his job, then that dramatically alters the entire 403b/401k concept. Has anyone here ever even seen such a restriction on a real life 403b plan? I'd be very doubtful any actually exit. The idea that an employer with an established 403b plan would later apply such a restriction is even more absurd. Imagine investing your money for 10 or 20 years expecting to be able to take it out when you hit 59 1/2 only to find your employer has suddenly changed the plan. You might even have grounds for a lawsuit. So, while it might be literally possible, I think the idea that a 403b plan would prohibit withdrawals at 59 1/2 is highly implausible. However, I can imagine a scenario where the TPA/employer could have or create a rule that charges a transfer out fee that would help pay for the addition costs and hassle. For example, they might say one transfer every 5 years is $0 cost, but each transfer beyond that costs $50 or something like that. One other thing to consider is that some vendors will charge transfer fees when moving balances out (and sometimes in). This fee is usually a flat rate. In one case I know of the fee is like $75 and you probably wouldn't know about it unless you read the fine print. So you'd be paying that each time you transfer a balance. I'm not talking about fees on regular contributions, just fees on vendor-to-vendor transfers (in or out of the 403b). Same with the TPA. They might have a flat transfer fee on anything going out or coming in and anything moving vendor-to-vender within the plan. I can't say I've encountered this, but I'm sure it's possible. Also, I've heard some vendors make getting your money out difficult even AFTER you've quit your job. I'm also guessing some will charge surrender fees or even possibly back loads. (Many vendors put the employee's investment into annuities inside the 403b) I think these sorts of fees are primarily just a way for the vendor to increase their profits, but they might also have a deterrent effect on frequent transfers. In short, I think rolling your money out at 59 1/2 into a no load low fee IRA is a good strategy and I doubt an employer would ever get away with stopping you from doing it, nor would he have any real motivation to do so. Consider also that in many cases these 403bs are held by school districts where the unions would throw their weight around. Also consider that in the case of smaller non-profits there might not even be a TPA, but even if there was the employee/employer relationship would likely be more personal so the employee could plead his case with more effect. After doing the big lump transfer at 59 1/2, regular transfers out after that would at worst get you hit with some extra costs in transfer fees which might make it not worth doing regular annual transfers depending on how big your contribution is each year and how excessive the fees are in your 403b. That's my 2 cents anyway.
  12. Can I Roll This Over?

    So once I hit 59 1/2 I can roll everything out of the 403b and into my IRA, right? But I can still keep contributing to my 403b, then rolling it over year by year?
  13. Can I Roll This Over?

    Years back when Vanguard was a vendor for my 403b, I made contributions for a few years then stopped. Some time after that Vanguard was dropped as a vendor but the 403b plan is alive and well. Any chance the fact that because Vanguard was dropped as a vendor I could roll my money out into my IRA like I could do if the entire plan was terminated? Also, when I'm 59 1/2 can I take the money out of the 403b and put it into my IRA even though I'm still working there? Thanks for the help.
  14. Roth 403B Vs 403B

    I'm aware of the PA system and you're right to be concerned, but run the numbers even assuming significant cuts to pension and check out IRS tax brackets. I think you'll find you're close to the same bracket you're in now when you retire. Keep in mind that when you take money out of a pre-tax traditional 403b plan (or convert it to a Roth), that it's also raising your income level which could put you in a higher bracket for at least a portion of the amount you take out. Also, it's not clear Corbett will be re-elected and he is certainly getting some blow back on the pension cuts. Last I heard he had a 14 point negative job approval score. One more thing. Unlike many other states, PA doesn't let teachers take advantage of its statewide 457 plan. That's something you should consider asking your union to look into. A 457 plan would open up twice the amount that you could shelter and, if they follow the model of other states, you can do huge retroactive catchup payments.
  15. Roth 403B Vs 403B

    The most basic thing to consider is whether or not you will be in a lower tax bracket when you retire. If so, it may be better to invest in a traditional pre-tax 403b now then take it out during retirement. You can convert it into a Roth later during retirement. Of course there are other considerations. If you're in PA, you both probably have a decent pension. In that case you may very well be in a similar tax bracket when you retire and you'd be better off contributing to a Roth now. Of course there are other things to consider, but tax brackets are the first thing you look at. Although this is not a 403bwise link, I think it's a good resource for comparing traditional (pre-tax) with Roth. http://www.bogleheads.org/wiki/Traditional_versus_Roth
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