Comments on: Sometimes 401(k)s are Better than IRAs

By: Should You Roll Your 401(k) to an IRA?

Should You Roll Your 401(k) to an IRA? — Mon, 28 Jun 2010 09:09:03 +0000

[...] Reasons for sticking with your 401(k) [...]

By: Traditional and Non-Traditional Unique Ways to Access Large Amounts of Liquid Cash | My Journey to Millions

Tue, 15 Dec 2009 16:20:40 +0000

[...] I have discussed, sometimes a 401(k) is a better option than an IRA, and this is only one of the reasons.Â If you have to borrow, why not borrow from yourself?Â The [...]

By: JoeTaxpayer

JoeTaxpayer — Fri, 20 Nov 2009 04:12:53 +0000

Ok, I'll give you another reason to replace dropped one:
Say you are above the phaseout range for being able to deduct an IRA contribution, and you've make post-tax deposits over the years. Starting in 2010, you can convert that money to a Roth with tax due only on the growth, not the money you deposited post tax. If you roll the 401(k) money to an IRA, it gets counted in the mix and tax must be paid in proportion to the pretax money you have. The IRA from the 401(k) transfer and the existing IRA must be treated as “one IRA” with pre and post tax component. Keeping the the 401(k) avoids this.

By: Evan@MyJourneytoMillions

Evan@MyJourneytoMillions — Fri, 20 Nov 2009 04:02:55 +0000

Joe, I am shocked but you are correct. see http://www.irs.gov/retirement/article/0,,id=162... question #5.

I will make the correction to the post.

That being said, I think there is still something to be said about the loan option.

By: JoeTaxpayer

JoeTaxpayer — Fri, 20 Nov 2009 03:20:50 +0000

I believe Hardship withdrawals are still subject to 10% penalty. Among the citations; http://www.401khelpcenter.com/hardships.html

By: My Journey to Millions Reallocates his 401(k) After Analyzing his Portfolio | My Journey to Millions

Thu, 27 Aug 2009 17:50:06 +0000

[...] First thing I should mention is my expense ratio. While an expense ratio of 1.1% is not great, when compared to low fee index funds, I do not have low fund index options within my 401(k). This 1.1% is worth it considering my match, and sometimes a 401(k) is better than an IRA. [...]

By: When Applying for a Mortgage don't Forget to Calculate your Debt to Income Ratio | My Journey to Millions

Wed, 29 Jul 2009 22:49:08 +0000

[...] Get a loan from your 401(k) to pay off higher minimum payment debt; [...]

By: You Have to Prepare for Retirement – Do Not Depend on the Government | My Journey to Millions

Tue, 23 Jun 2009 13:03:46 +0000

[...] it Setting up Different Retirement Accounts and being [...]