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Leaving state employment. Retirement question.
Posted on 3/27/15 at 11:49 am
Posted on 3/27/15 at 11:49 am
I am currently enrolled in LASERS but will be leaving state employment soon to become a private contractor (pass through LLC). I have less than 4 years accrued in the system (about $15k) and was told my account will not earn interest. I don't know if this is true or not but either way I don't have faith in LASERS and plan to withdrawal.
I can withdrawal in a lump sum (take a 20% penalty) or roll it over to a traditional or Roth IRA.
In a spinoff from a prior thread: I am looking to buy a house in the next year and leaning towards rolling it over into a traditional IRA so I can take advantage of the $10k first time homebuyer withdrawal if it means avoiding PMI.
Am I correct in my thinking? What would you do?
I can withdrawal in a lump sum (take a 20% penalty) or roll it over to a traditional or Roth IRA.
In a spinoff from a prior thread: I am looking to buy a house in the next year and leaning towards rolling it over into a traditional IRA so I can take advantage of the $10k first time homebuyer withdrawal if it means avoiding PMI.
Am I correct in my thinking? What would you do?
2
Posted on 3/27/15 at 12:25 pm to northern
No it does not receive interest. You do not get a 20% penalty. They take out 20% for taxes. You get a 10% penalty for an early retirement withdrawal when you file your taxes if you are under 55. If you can do the rollover basically to hold your money till the down payment is required, that would probably be the best avenue.
Posted on 3/27/15 at 1:48 pm to Styxion
Rollover no question and hopefully in a year or two when you find a house to buy you will hopefully not need to touch it.
Posted on 3/27/15 at 2:12 pm to eng08
quote:
Rollover no question and hopefully in a year or two when you find a house to buy you will hopefully not need to touch it.
Traditional or Roth?
Posted on 3/27/15 at 2:43 pm to northern
Don't burn your bridges with the state retirement system if there is even a remote possibility that you would work for the state again in the future. Get six more years of service and you're entitled to a pension at age 60. There isn't a sweeter deal out there.
Posted on 3/27/15 at 4:17 pm to northern
quote:
Traditional
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