Conference nyoss1::market_investing

    Assuming CA's Fidelity-managed 401k offers the typical huge
    smorgasboard of Fidelity funds, I can't see leaving it with
    BE's limited selection unless you're really in love with one
    of the BE offerings. .02 K 

    I think .0's plan is correct.  If he rolls it over
    into a brokerage IRA, he not only has complete control
    over it, but he isn't restricted to one fund company.
    
    Be sure you follow the IRS guidelines for how to roll the
    money over, so you don't get hit with a tax penalty.
    

> Be sure you follow the IRS guidelines for how to roll the
> money over, so you don't get hit with a tax penalty.

	This seems like a Deja Vu discussion, but in any case, one
	of the more important things to remember when transfering a
	401K to an IRA, is to *not* mingle the 401K money into an
	existing IRA account with non-401K money in it (though I
	believe the base noter already knows this when they said
	"seperate" IRA ...).

	Other things to remember is the time limit to roll it over,
	and to make sure the full amount, to the penny, is rolled over.
	And don't have the check made out to you, but to [i can't
	remember...]

    Make the check out to me.
    
    

    Get your pension money out of Benefits Express as soon as you can!
    My group was also sold.  We were told that we could leave our pension
    money with Benefits Express (Hewitt) for as long as we wanted.  What
    we were *not* told is that we would accumulate no (zero, zilch)
    interest on the money.
    
    It takes a minimum of 30 days to get your pension money out, so the
    lost interest can be significant.
    
    
    Steve

re .5

If you leave your money in Benefits Express, don't you still 
own the same number of shares in the various funds that you 
always did - so that if the funds go up, your balance goes up?
What does, "accumulate no interest"?

    re: .5 
    
    Just spoke with a representative of Benefits Express and explicitly 
    inquired about the effect on the Pension and 401(K) monies held by 
    them when an employee leaves Digital. 
    
    As you would guess, the daily interest for the Pension plan continues
    but (obviously) Digital does not continue to add the quarterly 
    dollars. The 401(K) continues to grow depending on your investments
    but no new dollars from you or Digital are added to the sum.
    
    You may call for yourself to verify.
    jc

    Several members of my group (Learning Services) asked this same
    question of B.E.  All we told the same answer: "You will not be paid
    interest".  We questioned the legality & tried to elevate the issue
    (as far as I know, nothing came of this).
    
    Note: This only applied to the pension, not the 401(k).
    Maybe the details of our sale were different(?).
    
    

    I suspect two different things are being talked about here.  When I
    left Adobe, I had a brain-boggling time extracting my 401K money
    from them.  It took months, and the money earned no interest/dividends
    while it was in their hands.  Legally, former employers can take
    literally as long as they want to roll your 401K funds over, and
    are not obligated to pay interest/dividends in the meantime.  In
    Adobe's case, the people running the 401K plan only release the funds
    at the end of each quarter.  My memory dims at this point, but
    something in my case delayed it for even an additional quarter.
    
    (This is all distinct from the 60 day IRS limit on putting the funds
    somewhere if they ever get into your own hands as opposed to going
    directly to the new IRA; note that you don't want the former to
    happen, since that hits you with a tax penalty.)
    
    This is not the same situation as deciding to leave your funds
    in the former employer's plan, where they earn interest (or dividends)
    just as normal accounts.
    
    I suspect the same may apply to getting pension funds...
    

    
    re: .5, .7 I called again and spoke to another rep of B.E. who suggests
    that a call to the HR rep and a request for the booklet 'Leaving
    Digital' ( not to be confused with Leaving Las Vegas ) indicates 
    has a section on page 9 stating that you can choose to leave the $
    for the Pension plan and Save to draw and accrue the normal interest
    and growth. 
    
    Now, if a group is 'sold into slavery' er, bought out by another
    company, there may be something in the agreement that locks that 
    pension money into the new pension plan of the receiving company.
    If so, that sounds like material for a class action against the 
    parties of the agreement. After all, whose money is it? 
    
    Hopefully, your milage will not vary. 
    jc
     

    
     I was told by personnel that my pension money would still accumulate
    interest at the going rate (7.13?% until July 1, 6.24% after).  I have
    the booklet "leaving Digital" and will check page 9.

     In our case, Computer Associates does not have a pension plan so our
    pension money can't be rolled into their plan.  In our case, the last
    day with Digital is May 31 and the letter has to be back to BE by 
    May 22.  I believe the check will be issued after June 1.

     At one point in the agreement Digital and CA were trying to transfer
    the funds directly from Digital's 401k to CA's 401k.  This was being
    done so people with outstanding 401k loans would not have to pay them
    back.  The people who had loans said they would be willing to pay them
    off, so we are suppose to be able to roll the money out of BE, but BE
    doesn't seem to be able to handle at this point.  I have to check on
    this.

     I'm planning on rolling my pension and 401k into IRAs so I can have
    more flexibility in my investments.
    
          Thanks for the help.
               John
    
    P.S. I'm going to miss the advice and knowledge of the people here.

    Hopefully folks won't mind the rat-hole...
    
    I've been wondering what the rate on the CAPP would be next 'plan year';
    
    .-1 indicates 6.24% - Is this an 'official' number? Given what treasury
    bonds have been doing lately, I'm surprised it is that low...
    
    Dave

    
    re: -1 6.24%
    
    I believe it is official because that is what we heard from personnel
    in one of our meetings.
    
        John

    
    	I don't think 6.24% is official, if I remember correctly each year
    the interest rate is re-calculated. The rate will be the average
    interest rate for the month of June + 1%.
    
    Ron

    
>    	I don't think 6.24% is official, if I remember correctly each year
>    the interest rate is re-calculated. The rate will be the average
>    interest rate for the month of June + 1%.
    
From the booklet we were sent in the mail:

"This rate will be adjusted each July 1 for the following 12-month period.
The annualized rate is calculated as the average one-year Treasury note rate
for the May 1 through April 30 preceeding July, plus an extra 1%."

(Note that this is a 12-month average).

I haven't been tracking the 1 year Treasury note rate, but I think it is
currently around 5.5%.  Since rates have run up some in the last couple of
months, I would tend to believe the 6.24% number.

Don

    I'll put a twist to this question...
    
    Suppose that one wants to roll BOTH the 401K money and the pension
    money into ONE IRA account. Since both of these are pre-tax money, is
    there any reason(s) why one shouldn't do this? I can not think of any
    reason not to do this. But, though it is a good idea to chech here just
    in case I have missed something.
    
    Thanks,
    
    Mike

> Suppose that one wants to roll BOTH the 401K money and the pension
> money into ONE IRA account. Since both of these are pre-tax money, is
> there any reason(s) why one shouldn't do this? I can not think of any
> reason not to do this. But, though it is a good idea to chech here just
> in case I have missed something.

	Well as always, check with an accountant if you want more accurate
	information (at least compared to my guesses :-).

	While they are both pre-tax, I would *not* mix them for the same
	reason you should not mix IRA money (pre-tax or not) with 401K
	money.  By mixing, I believe you will then be unable to roll
	any money back into another employers 401K, which I believe may
	otherwise be a possibility if you were to keep 401K money in
	a seperate IRA account.

    Besides, you never know when the IRS will change the rules for
    one "type of money" and not for another.  If they're mixed together,
    it would be a messy separating them.
    

    re: Jeff & Karen
    
    Good points. Thanks for the input!
    
    Mike

    
    
    	If I take the "lump sum" money at 65 can I put it an IRA
    	and draw from it over time so I don't have to pay an
    	immediate penalty?  hope this isn't a rat hole but am
    	worried about taking that option.  Thanks.

    
    Here's another reason why you want to rollover a 401K into another 401K
    (NOT IRA): You CAN take out a loan from 401K, not from an IRA. Unless
    you withdraw at whatever the legit age is (59 1/2??), if you take any
    money out of the IRA, it will be taxable and you'll be penalized for
    early withdrawal.
    
    Has anyone checked with ant CPA about mingling both CAAP and 401K
    into ONE rollover 401K? I am a bit confused about that. I can't see
    any apparent difference, to raise any IRS flag, do you? 
    

    re: .21
    
    First thing first... What is CAAP? 
    
    I personally think the reasons given in .17 & .18 were enough to
    warrant keeping the two pots of money separated. Yes, there is one more
    set of records one has to keep. But, that is a relatively small price
    to pay. So, I openned two separate accounts for that purpose. But, I
    did not check with a CPA, though. Basically, what I am doing now is to
    "anticipate" possible future complications. 
    
    Of course, your situation may vary...
    
    Mike

    sorry, I mean CAPP? Cash Accumulation Pension Plan which is the current
    Digital's Pension plan.
    

    Given that upon leaving you can roll CAPP into SAVE, and you can then
    roll SAVE into an IRA, why would there be a need for seperate records 
    if you chose to roll CAPP and SAVE into the same IRA directly?

> Given that upon leaving you can roll CAPP into SAVE, and you can then
> roll SAVE into an IRA, why would there be a need for seperate records 
> if you chose to roll CAPP and SAVE into the same IRA directly?

	When dealing with the IRS (or the government in general :-),
	never assume something just because it is logical.....

	If you want to roll both CAPP and SAVE into a single IRA account,
	I'd for sure check with a qualified accountant, and/or do the
	two step process you mention (ie. roll CAPP into SAVE so that
	the previously CAPP funds are now officially SAVE funds, then
	roll it into a IRA [that is seperate from from any other IRA
	accounts containing non-401k source funds]).