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Questions About Pension2 Changes

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ScottyD,

 

Thank you .....that helps tremendously !!!!

 

Will the 403 and 457 contributions go directly into the Ameritrade account without stopping at Voya?

 

Once again...Thank you...Bob

Bob,

 

I don't know the answer to that question, let me look into it.

 

ScottyD

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DK,

 

I don't know the answer to your question but I feel the 3 week "lock-out" period is extremely offensive. After much deliberation, I have liquidated my entire 403 and 457 accounts; I will go all cash until 11-10-14. Bob

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Bob,

Can you provide more details on why you liquidated your entire accounts to cash? What is specific about 11-10-14?

Decisions by experienced investors such as you helps less experienced learn how to manage accounts.

Steve

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Scotty D,

 

You mentioned earlier that I would need to transfer the TIAA Traditional to CREF money market before the transition. Why is that, and what will happen if I don't?

 

Also, what happens to our investments during the blackout period? Do they continue to earn (or lose, as the case may be)? Or are they just "shelved"?

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Steve,

 

I am speaking to the equity fund portion of my portfolio only and I do not own any fixed income (bonds) funds. As you know, I am a DIY active manager of not only my money but also many family members. The thought of being handcuffed by P2 from 10-27-14 through 11-10-14 is terrifying.....it's as simple as that. The significance of 11-10-14 is the random date selected by P2 to end the "lock-out".

 

Bob

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Hi Bob,

I am a DIY too, as with most regular posters here.

I don't understand why you are terrified of being handcuffed by P2 from Oct. 27 to Nov 10th. What is it that you want to do that couldn't wait 10 trading days?

 

BTW, you are an extremely brave family member to be managing "many" of your family members' money too!!!!! That's incredible. Of all the years I have been posting on M*, Bogleheads and here, I have not heard of anybody (passive or active) managing their families money too, except a spouse and sometimes an aging parent. My mother use to say that blood runs thicker than water, but it boils faster! What do you say when the market starts getting volatile like it is now? How are they prepared for the risks when accounts fall from time to time? Have they read up on investing, so they have an idea what you are doing? Are they using target date funds?

 

Sorry for all the questions, but managing one's own money is complicate enough because of emotions. People can agree on a great plan UNTIL the market acts up and they bail, which you and I know is a mistake.

 

Steve

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I just wanted to let people know I called and spoke to a rep at Voya , and investments will only be tied up for one trading day--October 31st. After that they will function as usual in the Voya accounts.

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thanks Maggie,

Does Voya know it's Halloween. :-)

My point is that if one has a low-cost diversified equity and bond plan with fixed account allocation appx close to your age, this will carry the investor through thick and thin. Why get upset if you cannot trade for 1 day, ten days or 50 days. P2 is an excellent employer sponsored retirement plan. That extremely short time period is insignificant with a long term prospective, even during this volatile market now and even with active management types. Heck, Warren Buffett has held about 36 stocks for years and years, give or take buying or selling one or two every 3-4 years. All of the authors that I have read said to create a plan and stick with it: Bernstein, Ferri, Swedroe, Bogle, Otter, Buffett, and many others. Its not what P2 or Voya does, or the stock market, CNBC, talking heads or what the entire world economy does regarding war and peace, disease, etc., its what we do that counts. Its always been that way. Books have been written about behavioral finance. We must manage our emotions with an understanding of how the market can work for us by lowering our expectations, settling for the average returns (nothing wrong with 8-9% return), expect to make mistakes and lose money from time to time. The biggest obstacle is our emotions, that's inside us, not out there.

Steve

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Steve,

 

Perhaps the best way to explain my involvement in my families monies is that of a vocabulary course. My grandchildren do not understand the difference between a Coverdell ESA and a College 529 plan. My aging parents don't know the difference between an ETF or CEF. My brothers nor my children and their spouses understand the complexities of SEP, ROTH, TRADITIONAL IRA's or 401, 403, 457 plans. Rollovers and conversions are essential to understand as employers and careers change. RMD's are another success problem that will need to be addressed. In other words, they are busy with their careers and are not interested in Index Investing, Contrarian, Value, Growth or any other style of investing; I try to help and educate them. Bob

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Guest adirondacks

Hi Bob,

 

As you are well aware of: " when you fish for a person you give that person a meal. But when you teach that person how to fish that person will never go hungry.

 

Best,

 

Joel

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Hi Bob,

You should be commended for helping your family. I have friends that want recommendations or advice, and I usually refer them to an Adviser from NAPFA or Garrett networks. For example, a friend has been in cash since he got out in 2008 and was wondering about getting back in. This was several months ago when the market was soaring. I said to stay out because he will be making the same mistake again now on top of the one he made in 2008 by bailing out. Just by asking that question means to me he is scare of the market and does not know much. One needs to be respectful of the market as it knows a lot more than any of us.

 

Does what Maggie report mean anything to your plan since it is only one day instead of two weeks of frozen assets?

 

Have a great day,

Steve

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The Ameritrade 403 will be rolled into an Ameritrade Traditional IRA and in January it will be converted into an Ameritrade Roth IRA.

 

The Ameritrade 457 will be utilized until "separation of service" is triggered. Bob

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