Real World Finance$

Madam X over at My Open Wallet just posted some information on The Candidates’ Economic Proposals: IRA & 401k Withdrawals.  Both McCain and Obama seem to think allowing people to withdraw their 401(k) or IRA funds early with no penalty will help stimulate the economy by getting people money to spend to cover this difficult time.

Excuse me, but aren’t those funds in the stock market?  Doesn’t the average consumer typically judge our economy by whether the stock market is up or down?  So, you think that allowing people to take MORE money out of the market without being penalized is going to HELP?  I’m flabbergasted is all I can say.

What a great way to really send the stock market into an all out tail spin.  People who are already afraid of the market would now have access to pull everything out causing an even further decline.  Their worst fears will be realized as a self fulfilling prophecy.

Does this idea scare other people as much as it scares me?

No, not me, it’s my brother.  I got word from him yesterday that everything is official now.  He will be moving to Beijing, China this summer to work for a minimum of 6 months.  The project could go as long as 1-2 years.  He just bought a house and sold his a year or so ago.  It looks like my parents will be moving back from Florida and staying in his house until he returns. 

Now, I’ve mentioned my brother before in one of my posts (Conversation with the brother).  As I said there, he is a very frugal and has always been somewhat stingy with his money.  I wish I had been a bit more like him in that way.

So, here’s a guy who is in his mid, going on late 30’s, not married a house with lots of equity and quite a bit of savings and retirement.  He’s doing very well for himself.  He’s getting shipped off to another country to work for a while.  The package is including a significant raise during  the time of the assignment (he said something along the lines of 30%), paid housing while he’s there and per diem money for food and expenses. 

Knowing him, he will be making money on the per diem alone and will have nothing to pay with his increased salary but his mortgage back home (the parents will be paying for the utilities and upkeep).  If he gets extended out for a full year or more, he will also have some significant tax savings as well.  If I also know my brother, he will come back home and probably almost able to pay off his house if he felt like it.  I don’t see him doing that, but I know he will have a TON of savings and some new retirement accounts open by then.  Guess he’ll be well on his way to retiring at 50 if he feels like it.

I have been a bit under the weather the last couple of days.  I did want to share with you though an article that shows exactly how I plan to retire from over at Business Week.

Starting a Business Instead of Retiring

 I enjoy being active too much to just sit idly by in retirement.  I figure it’s better to stay active doing something that bring in income rather than draining down any savings I have by then.

Hope to be back to normal tomorrow!

Yesterday I ran across this article on CNN Money (Retire Rich: Learn from someone who did).  They story is about a retired executive from Boeing who started a website where he offers excel data sheets to analysis different retirement and financial planning scenarios. 

This sounds so much like something I would do.  Like him, I have an engineering degree and have spent time in my career in planning/forecasting and financial analysis.  That’s why you’ll find my page up top with Downloads.  So, check out what I have to offer.  More will be coming in the months ahead as I analyze my own situation.  And check out what this guy has to offer as well over at Analyze Now.

I have a decision I need to make that I’ve been putting off. Back in July I changed jobs. That left me with about $3k in a 401(k) at my previous employer. I’m supposed to move the money out, but they said there is no deadline, so not sure how they enforce that. The account is currently with Vanguard and my new job 401(k) is with a small local firm.

So, now I’m debating what I should do with my account. I’m really unfamiliar with this area and whether a Rollover, Roth or Traditional IRA is best. What are the pros and cons of each. I guess I’ll start with some research and see what I can find online. I’d probably like to do the move sometime early next year, so we’ll see what we do.

I do have banking accounts at E*Trade presently, but no investment accounts. I’m not disappointed in Vanguard either, they have a very good selection of funds. I’m not hip on moving them to my current plan as this is a contract job and I don’t expect to be here long term either. I’d like to start putting my retirement accounts all in one place at some point and would like to find a good place to do that.

Any advice from the blogging world out there?