Questions & Answers

They are completely separate accounts and do not affect one another. Your 401k money is yours, and you can withdraw from it after leaving your company, or turning age 59 1/2, whichever is later. You will owe taxes on the money. If you withdraw prior to age 59 1/2 you will pay taxes AND a 10% penalty for early w/d. Your Social Security benefits are separate and you can start to receive them as early as age 62. To receive the maximum SS benefit, you will need to wait until age 66 or 67 depending on your age. Prior to age 65, your SS benefits can be reduced by earnings from a job. After age 65 they are not. By the way, you might also have a couple of IRA accounts or other savings accounts. None of them affect the others. Don't worry about double dipping. It is all money YOU have contributed, so it's YOUR money you are getting back, completely legal and correct. Hope this helps.

If you are using a Roth or Traditional IRA, you can use an annuity, but you may save money by using a direct mutual fund instead. The benefit of an annuity is tax-deferral, but you already have that in the IRA wrapper. Using an annuity within an IRA usually will cost you more money, because of the insurance protection built into the annuity. The longer your time horizon, the less sense an annuity makes. An annuity does guarantee return of your premium payments and a small return, should you die before annuitizing, but if your investment is wise, you won't really need this protection. The pro is the insurance protection, but the con is the additional internal costs. Your annuity also may provide less investment choices than a mutual fund family would provide. In addition, a self-directed IRA can be used for a wider range of investments, including real estate. See your financial planner for assistance in your retirement planning. Good luck!

Great question, Gladys. If there was a mandatory requirement age by profession, it would have to be arbitrary. Who is to say a 75 year old person is not competent? He may be more competent mentally than his peers and still have a lot to offer. Einstein is an example. But if Einstein's hands were shaky, I still would not want him to operate on me. (assuming he was a surgeon) On the other hand, I am sure there are 40 year old surgeons who are incompetent. My daughter refuses to go to a female dentist because she says they are not strong enough. (I disagree). But would a 35 year old female dentist be stronger than a 75 year old male dentist? It would be a dangerous generalization to say all people of the same age in the same profession are on equal footing. I plan on bringing this subject up with my legislative representative next time I see him, to get his views.

As long as you put it into the same type of plan that your current IRA is (Roth or Traditional), you can combine them, as long as the type of investment you put it into will allow the addition (you may have to wait til maturity if you put it into a CD).