I had a client ask me for some financial advice this morning. Generaly, as a cpa, unless its tax related, I defer questions to the clients financial advisor but hes a friend so I gave it a shot.
Situation: Client is self-employed and has a SIMPLE IRA (more than 2 years). His wife works for X company and has a 401k. They usualy max out the wifes 401k contribution because her employer matches a high amount, however, they did not do this in 2012. Last week the wifes employer announces they will match up to 15k of any contribution for the remainder of the year.
My client is strapped for cash at the moment and asks me if it smart for him to pull out 15k from his SIMPLE and put that towards his wifes 401k. His advisor says no.
I think his advisor is an idiot. Sure, he will pay the 10% penalty but I dont see why one would suggest missing out on a 15k match, but then again, maybe Im the idiot.
This post was edited on 10/3 at 1:52 pm