What should I do with this check? The choices are there.
First thing to remember is these monies will come at a later date, something like 3 to 6 months from what I understand, so there is some time to investigate and give a good thought on what you want to do with this money. So check out all your options, but don’t wait to long, because if you procrastinate and receive that check it will be less 20% taxes and 10% penalty for a total of 30% less money.
Direct payment to me, 20% taxes will be applied if you take this option,(Plus 10% penalty if you’re younger than 59 1/2 years old.)
Roll it over to one of the following options:
Traditional IRA
You have to find the fund yourself.
Roth IRA
You have to find the fund yourself.
401k(Eligible Employer Plan) This is the option I took.
Keep it in the fund until a further date and participate in any losses or gain(see your union rep).
After weighing everything I chose the 401k that the city offers.
Why my choice?
First the City has done a good job over the years with my monies.
They don’t charge that much to manage my account.
The 401k gives me options on where the monies are allocated to.
Happy Retirement 🙂