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401(k)
What's the Difference Between an IRA and a 401k?
One of the most common questions I get from readers is, "What's the difference between an IRA and 401(K)?"
If you're an athlete, 401(k) sounds like it should be the length of some torturous marathon. Of course, IRA might evoke images of the Irish Republican Army.
Are You Still Contributing to Retirement Savings?
It's not surprising that some people are tempted to pull the plug on retirement contributions when things are tight, but it's important to continue on the path to saving enough for the golden years. Have you kept up with your contributions as the economic crisis has worsened?
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Are You Still Contributing to Retirement Savings?
5 Things to Accomplish Before 2009
We are down to the wire of 2008, and now is the time when many of us procrastinate with the rationale that we'll be on top of our game in the New Year. There are a handful of money and job-related tasks that can't wait until the ball drops, so get on the ball now by accomplishing these five things before 2009. Start the slideshow to see what should be at the top of your to-do list.
Savvy ATM: Revisiting the Retirement Account Rollover
Job hunting might be the only thing on your mind after losing a job, but don't let your 401(k) from your previous employer slip through the cracks. Deal with wrapping up those loose ends before diving into the job search head first, otherwise you're more likely to indefinitely postpone the task.
Your 401(k) savings can be rolled into a Traditional IRA account without penalty.
Definition: Hardship Withdrawal
A hardship withdrawal is when a 401(k) account holder removes funds from her retirement savings because of circumstances like job loss, facing home foreclosure, or overwhelming medical expenses. While withdrawal is permitted during those tough times, the account holder cannot get away from the 10 percent tax penalty incurred when the funds are removed.
According to The Wall Street Journal, several 401(k) plan administrators reported a noticeable increase in hardship withdrawals this year compared to last.
Money Tip: Pay Your Bills on Pay Day
When I was a fresh college graduate earning my first real paychecks, I quickly saw how living in a city like San Francisco isn't made for entry-level salaries. Exploring the city and all of its nighttime gems were certainly priorities, but the biggest priority was to keep myself out of debt while not depriving myself of enjoying my new surroundings.
I struck a balance by forming the valuable habit of paying all of my bills on pay day.
Your Two Cents: Have You Started Saving For Retirement?
There are a number of vehicles available to help us save for retirement. Maybe you're participating in your employer's 401(k) plan, you're saving in a separate IRA account, or you're using a combination of different accounts. Have you started saving for your golden years?
Definition: 401(k) Debit Card
A 401(k) debit card is deceivingly like the debit cards you're familiar with, except the money is drawn from your retirement savings and must be paid back to yourself with interest — essentially, it is a loan against your 401(k). You're responsible for making punctual payments, and if you miss one, you risk having to pay early withdrawal penalties.
While you'd be paying interest now, you'd really be borrowing from your future self.
Does Your Employer Match 401(k) Contributions?
There are researchers out there who think the days of employers matching 401(k) contributions should be numbered. They argue that money would be better put to use by funding other employee benefits, and say employees would continue to participate in 401(k) plans even without the match.
The loss of this incentive wouldn't affect all workers, as there are plenty of companies that already do not offer an employer match.
Three Tips For Sticking to Your Retirement Savings
Unless you're hooked up with a bullet and foolproof investment plan, chances are your retirement savings have taken a beating over the past many months. You're not alone! My 401(k) has been dragged through the trenches and the result is not pretty.
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