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Joined: Nov 2007
Posts: 29,625
Campfire Ranger
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Campfire Ranger
Joined: Nov 2007
Posts: 29,625 |
There are two issues the OP seems to be confusing.
1) an IRA is a tax deferral tool. Funds designated as IRA funds can be invested in a wide variety of products from FDIC-insured savings accounts to mutual funds, individual stocks, real estate, etc.
2) one can pull money from a traditional IRA tax penalty-free at 59 1/2 yo, but one can move IRA funds between investment vehicles before 59 1/2 yo tax penalty-free.
Therefore one can pull out of the stock market without “scrapping an IRA” that was formerly invested there, or vice/versa.
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Joined: Nov 2011
Posts: 30,946
Campfire 'Bwana
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Campfire 'Bwana
Joined: Nov 2011
Posts: 30,946 |
I'm not an expert. But I pushed 25% of my 401k from stock funds to t-bonds when Russia invaded Ukraine. I'm still waiting for "bottom" to move it back and I should probably be paying closer attention to the market.
Met with our advisor re: IRAs last week. Apparently bonds took a hit too lately, so the usual bonds vs stocks offset hasn't really applied lately. If you're lessing willing to tolerat risk, laddered CDs are an option to take advantage of rising interest rates. My 401K been mostly cash since the NDX pulled back about 4%.
You didn't use logic or reason to get into this opinion, I cannot use logic or reason to get you out of it.
You cannot over estimate the unimportance of nearly everything. John Maxwell
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Joined: Dec 2006
Posts: 4,113
Campfire Tracker
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Campfire Tracker
Joined: Dec 2006
Posts: 4,113 |
I'm not an expert. But I pushed 25% of my 401k from stock funds to t-bonds when Russia invaded Ukraine. I'm still waiting for "bottom" to move it back and I should probably be paying closer attention to the market.
Met with our advisor re: IRAs last week. Apparently bonds took a hit too lately, so the usual bonds vs stocks offset hasn't really applied lately. If you're lessing willing to tolerat risk, laddered CDs are an option to take advantage of rising interest rates. I would suggest to stop timing the market and get in. You have lucked into some good percentage points to earn in when things go back up, which they will. Dont try to catch the very bottom, be glad for what you saved.
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Joined: Dec 2006
Posts: 4,113
Campfire Tracker
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Campfire Tracker
Joined: Dec 2006
Posts: 4,113 |
Any of you over 59&1/2 years people with an IRA considered or already have dumped your IRA for something safer? Tax hit or not another 2&1/2 years of this administration there's not going to be enough left of it to make a difference. A low interest savings account doesn't look that bad right now. That wouldnt make much sense, but I dont know your exact situation. Getting out now (the damage is already done) is probably not a good move (I am not a pro). Things will turn around before too long and make their way back up. The market keeps going. One thing that is wise to do and is likely the route I will take when it nears time to retire is to have a CD ladder to cover 3 years of expected spending. That will allow me to live off the CD ladder while the market goes through its roller coaster events. I will have a CD to cash out every year that will provide a years worth of spending. If the market is still down after that year, when I cash the second CD, I wont buy one to replace it. When the market comes back up and its ok to sell mutual funs (or stocks), then rebuild that CD ladder.
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Joined: Dec 2006
Posts: 4,113
Campfire Tracker
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Campfire Tracker
Joined: Dec 2006
Posts: 4,113 |
Hold on, the stock market will bounce back! It may take a year or two. This is the right way to go. The damage is already done. The market will come back. People miss the big part of the come back by trying to time the market.
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