My wife has 110K in her retirement mutual funds (it was started before we were married and I can't touch it; I'm just the beneficiary). I've tried to reason with her about pulling the money out regardless of the penalties involved. She feels I've gone overboard because I'm trying to follow some of Michael Hyatt's recommendations. Advice, please?

-- Livin Witha Polly (bennett@peachnet.com), July 21, 1999

Answers

Your wife seems a wise woman. If you are interested in security, simply ask her if she might want to reallocate the funds into a more conservative mix of investments (short-term T's). You can easily point to the overvalued market and suggest profit-taking might be in order. With all due respect, it is her money. Perhaps you'll agree... the relationship is far more important than the account.

Regards,

-- Mr. Decker (kcdecker@worldnet.att.net), July 21, 1999.

If it's a 401K, take out a loan against it. Some plans allow you to borrow up to half the amount. You pay a pretty decent interest rate, usually about 8-9%. This allows you access to half the funds with no penalties. If things collapse, well, there may not be anyone to owe. If they don't, put it back in at the end of the rollover with no penalty. You must consider the cost of obtaining the loan, and the plan may prohibit you from making investments for about a year, but it may be a good alternative. If the money isn't a 401K, good luck with the argument, hope you win! Consult your financial advisor before you do anything, though, don't take my word for it.

-- ariZONEa (watching_you@work.com), July 21, 1999.

Say no to the loan.

A 401K loan is nice in concept and has helped many people pay for homes, college, ect... The bad part of the loan concept is that if you loose your job, the loan becomes due at that moment. If you do not have the cash to pay it off, your fund gets liquidated and you get hit with: 1. Regular federal income tax which is added to your current income for that year. 110,000 removed from your account will push you into a much higher income tax bracket. 2. Regular state income tax. Same as #1. 3 Early withdrawal penelty of 10 percent of the amount. If you thought that #1 and #2 was high add another 11,000 to it.

When you are done paying the loan and the taxes if you loose your job there will be nothing left. Remember it is a 50% loan and about 50% in taxes if it is liquidated before 59.5 years old.

She should transfer it to a safer portfolio mix as the first poster suggested. T-bills were a good suggestion, garenteed income might be another. Stay away from Small caps or International funds.

good luck

-- Ned P Zimmer (ned@nednet.com), July 21, 1999.

Hello, People?

This is a PLANT.

Somebody after Michael Hyatt.

Sorry to be so cynical, I work the "opposition" for a living and I can just smell these things.

-- Lisa (lisa@work.now), July 21, 1999.

I can see why you would want to take ol' Mike's advice, given his success rate as a prognosticator. Let's just see how he has done so far:

April 1, 1999. On this date, Canada, Japan, and the State of New York begin their fiscal year. This will, of course, include dates beyond Y2K. As a result, planning systems, especially budgets that have not been repaired will fail as they attempt to process Y2K dates. Since New York City is the media capitol of the world, problems there will grab headlines worldwide. Problems in Japan will remind everyone again of how interconnected our world is. The Japanese will also be forced to admit that there systems might not make it. I expect the stock market to react and begin (or continue) its downward spiral. Public confidence will continue to wane and the number of Y2K optimists will continue to dwindle.

July 1, 1999. On this date, forty-four U.S. states begin their fiscal years. The problems that began in New York will now spread exponentially across the country and around the world. The public will feel the global and pervasive nature of the Y2K Problem for the first time. This will be further exacerbated by the fact that many states have not had the resources to adequately address their Millennium Bug problems. Consequently, the failures will be real and widespread.

From the 12 Oct 1998 issue of Westergaard - Michael Hyatt

-- Y2K Pro (y2kpro1@hotmail.com), July 21, 1999.

To Y2K Pro, Obviously, you did not read Ed Yourdon's reasons as to why those dates were not impacting as of yet. You take what you want from Hyatt's advice depending on where you fall on the doomer/polly graph.

-- Don O'kelly (Oaks@Lauderdale.net), July 21, 1999.

I have 450K in my retirement funds. I will just continue to manage them as I have in the past, moving them only slightly. In 1987, I lost 50% of my funds at that time due to the "crash". Since that time the same funds (which I haven't moved) increased nearly 700%. They went from 40K to 20K now at 120K. Not bad for just letting it sit for 22 years.

-- Maria (anon@ymous.com), July 21, 1999.

Ops, typo 500%.

-- Maria (anon@ymous.com), July 21, 1999.

Maria; wonna get married? I'm really well endowed,......well, not financially........did I spell that right?

-- Ralph Kramden (and@awaywego.com), July 21, 1999.

Lisa,

You're the plant hon. If you honestly think that there are not people on this earth who have woken up to the fact that Hyatt, Yourdon, North, Hamasaki, et. al. are full of CRAP, then you're sadly wrapped up in your own little "@work" world, and can't see beyond your pitiful little nose. But we already knew that. Big font size won't change that fact.

Don O'kelly:

Y2K Pro obviously DID read Mr. Ed the Talking Horsecrap's "reasons as to why those dates were not impacting as of yet"; same as I did. Mr. Ed's non-arguments hold water about as much as Mr. Clinton's "that all depends on what the definition of 'is', is" testimony.

Anyone who can defend such weak arguments is mentally GONE. BYE-BYE.

-- Chicken Little (panic@forthebirds.net), July 21, 1999.

Help me! Please! Bwok Bwok Bwok Ba-Wock!

-- Chicken Spittle (panic@forthebirds.net), July 21, 1999.

Maria, That's really wonderful for you. Given the coming crash however, it might be wholly more satisfying to put your knowledge of firing (rockets, missiles?) to work and send that bundle o'cash straight to the moon.

-- Gia (laureltree7@hotmail.com), July 22, 1999.

It's disappointing to see a thread on such a good question degenerate into a bunch of foolish, off-topic bullshit.

-- Clyde (clydeblalock@hotmail.com), July 22, 1999.

Gia posted:

Maria, That's really wonderful for you. Given the coming crash however, it might be wholly more satisfying to put your knowledge of firing (rockets, missiles?) to work and send that bundle o'cash straight to the moon.

-- Gia (laureltree7@hotmail.com), July 22, 1999.

********

Gia, You act as if "the crash" is a done deal. Every day there is more information pointing to the fact that it is not going to happen. Why do you believe there will be a crash? Can you point to specific reasons? Not conjecture and not at the word of "sudden" experts who have no first hand knowledge in the areas they are said to be "expert" in?

-- Cherri (sams@brigadoon.com), July 24, 1999.