Serious moves for desperate times.

[Mr. P]

In mid October I moved all my 401 out of stocks. That was a good thing, I've actually made a bit back since.

Now, I'm giving serious though to pulling everything out, taking the penalty an paying the tax before the Gov., in desparation, takes it or it's all lost due to a total collapse.

Anyone else thinking along these lines? At least we'd have something in the mattress.

[DannyR]

Now, I'm giving serious though to pulling everything out, taking the penalty an paying the tax before the Gov., in desparation, takes it or it's all lost due to a total collapse.Thats a huge mistake in my mind, especially given the penalties. But I won't argue too hard trying to stop you. The market won't recover till all the sellers jump ship and in my opinion its way oversold already. Probably too many people invested as it is.

How close are you to retirement? I'm 25-30 years away, and personally I'm putting as much money as I can spare into the market. These are bargain prices in my opinion the likes I'll probably not see again. Its going to prove to be a huge gift to me come retirement days down the road.

There are solid companies out there who's services will be needed even in the worst recession and who are in good enough financial shape to survive the current credit crunch. Do some research and transfer money to them rather than pulling it out entirely.

http://www.fool.com/investing/value/2009/03/03/stocks-for-the-next-great-depression.aspx

[Kathianne]

Sounds like you're both probably right, for your ages and responsibilities. Over 50, I got out in late September, can't afford the bloodbath, already has lost close to 25%. If I'd rode it out, would be like 40 or 50% gone now. I don't have the income or the time to make that back up.

Now if I were in my 20-40's, very different story...

[Mr. P]

Thats a huge mistake in my mind, especially given the penalties. But I won't argue too hard trying to stop you. The market won't recover till all the sellers jump ship and in my opinion its way oversold already. Probably too many people invested as it is.

How close are you to retirement? I'm 25-30 years away, and personally I'm putting as much money as I can spare into the market. These are bargain prices in my opinion the likes I'll probably not see again. Its going to prove to be a huge gift to me come retirement days down the road.

There are solid companies out there who's services will be needed even in the worst recession and who are in good enough financial shape to survive the current credit crunch. Do some research and transfer money to them rather than pulling it out entirely.

http://www.fool.com/investing/value/2009/03/03/stocks-for-the-next-great-depression.aspx

Way closer than you son. As I recall yer in yer 30s If I were there I'd BUY (cautiously), but I'm not. I'll never recover what I've lost just this yr before I retire.

[manu1959]

i look at is amoney i never had......let er ride.....unless you pulled out in october of 07.....the damage is done.....

i wouldn't add to the blood bath though i would but gold or cds....go low risk.....

[DannyR]

Way closer than you son. As I recall yer in yer 30s If I were there I'd BUY (cautiously), but I'm not. I'll never recover what I've lost just this yr before I retire.True, but I'd still not cash out entirely. The 10% penalty will just make it worse.

Much better to keep it in the fund and just transfer the assets over to bonds or something that won't lose money if the market drops. (which it sounds like you already did, so why change?)

If you're worried that even solid investments like bonds will fail and the economy is facing a Great Depression type crash, then it won't matter if you have the money in the mattress or not, because cash itself will be worthless as inflation skyrockets. Better invest in something solid like gold or buy some farmland.

[Mr. P]

True, but I'd still not cash out entirely. The 10% penalty will just make it worse.

Much better to keep it in the fund and just transfer the assets over to bonds or something that won't lose money if the market drops. (which it sounds like you already did, so why change?)

If you're worried that even solid investments like bonds will fail and the economy is facing a Great Depression type crash, then it won't matter if you have the money in the mattress or not, because cash itself will be worthless as inflation skyrockets. Better invest in something solid like gold or buy some farmland.

Yep! The mattress thing was just a reference for a safe place...

[avatar4321]

In mid October I moved all my 401 out of stocks. That was a good thing, I've actually made a bit back since.

Now, I'm giving serious though to pulling everything out, taking the penalty an paying the tax before the Gov., in desparation, takes it or it's all lost due to a total collapse.

Anyone else thinking along these lines? At least we'd have something in the mattress.

If the government collapses, it will be worthless whether its in a bank, 401k or in a mattress

[Silver]

In mid October I moved all my 401 out of stocks. That was a good thing, I've actually made a bit back since.

Now, I'm giving serious though to pulling everything out, taking the penalty an paying the tax before the Gov., in desparation, takes it or it's all lost due to a total collapse.

Anyone else thinking along these lines? At least we'd have something in the mattress.

Take it out....see if your bank will allow you to roll the money over into a cash account or and IRA CD....
I actually found a bank to give me 5% on an IRA CD when I did my rollover...

have the check made out TO THE BANK
don't pay the tax or a penalty, its not necessary...

[DannyR]

If the government collapses, it will be worthless whether its in a bank, 401k or in a mattressThats why I mentioned gold or land... two things that one can use no matter what government is out there... so long as you have the weapons and ammo to hold onto them when the race riots start. :laugh2:

[DannyR]

don't pay the tax or a penalty, its not necessary...I have a feeling Obama is about to nominate you to a Cabinet post.

The bank might not withhold the penalty on their own, but you are usually still liable for it come tax time and should have reported and paid it.

[Classact]

In mid October I moved all my 401 out of stocks. That was a good thing, I've actually made a bit back since.

Now, I'm giving serious though to pulling everything out, taking the penalty an paying the tax before the Gov., in desparation, takes it or it's all lost due to a total collapse.

Anyone else thinking along these lines? At least we'd have something in the mattress.I think there will be a rally soon and you could play SPR and track the index... Copper prices are off their low of $1.28 and back to $1.72 or so today... when copper goes up they are anticipating a market surge, it's like a barometer for the stock market. You can watch the copper future prices on CNBC... Gas prices are ready to surge too along with the rally jumping 10 or 12 cents a gallon today... my guess is a rally that peaks as the summer vacation starts... gas should be at around $3.50 - $4.00 by then is my guess followed by a sell off... use automatic limit orders to trigger sells at lower levels to protect your gains and reset them every few days to assure you don't get caught napping. Today could be a false start and a sell off could follow but a rally by summer break is almost a sure thing.

[Mr. P]

I have a feeling Obama is about to nominate you to a Cabinet post.

The bank might not withhold the penalty on their own, but you are usually still liable for it come tax time and should have reported and paid it.

There's no penalty or tax for a direct rollover to an IRA, Danny.
I think that's what Silver is referring to.
If ya take the check and cash it though, yer screwed . Plus as I recall there's a time limit to move it into another IRA. 60 days I think?

[DannyR]

If ya take the check and cash it though, yer screwed yup, thats what I thought he meant since he said cash account. *shrug*

[Silver]

I have a feeling Obama is about to nominate you to a Cabinet post.

The bank might not withhold the penalty on their own, but you are usually still liable for it come tax time and should have reported and paid it.

Its a rollover of a 401K .... you don't take possession of the money...its stays in an IRA account, be it cash, CD, etc....NO TAX OWED, NO PENALTY

When the hell does a bank impose a penalty on a depositing customer ???

[SupportUSA]

since the great depression of 2009

[Mr. P]

since the great depression of 2009

Huh?

Hit that "quote" button SupportUSA, it makes yer post more clear.

[sgtdmski]

In mid October I moved all my 401 out of stocks. That was a good thing, I've actually made a bit back since.

Now, I'm giving serious though to pulling everything out, taking the penalty an paying the tax before the Gov., in desparation, takes it or it's all lost due to a total collapse.

Anyone else thinking along these lines? At least we'd have something in the mattress.

Why don't you check of your investment company will allow you to transfer your money into a money market or CD instead of a full withdrawal?

My company allowed me to move money from the mutual funds into a money market which has pretty much stabilized as well as buying some individual stocks without any penalties.

As a matter of fact I am hoping to make a few bucks in the next few days with Citigroup. When it dropped below $1 today, I was lucky enough to buy 1000 shares. I am hoping that it will increase, it closed at $1.02, but I think that it might reach $2.00 before the end of the year.

But lie everything it is a risk, but right now is the time to take some risks. Even if the stock only reaches $1.50 I will have made 50%. What the market needs right now is not more government monies but rather private investment, although I am not looking forward to pay the taxes on my gains, I need to mae back some of the money I have lost before I moved my investments around. I saw my fund lose about 40% of its value, which was a big hit.

But as far as the 10% penalty, it sure the hell beats a 40% loss in value.

dmk

[DannyR]

Thats why I mentioned gold or land... two things that one can use no matter what government is out there.Thinking it over for the past couple days, I've changed my mind on investing in gold.

The all time high for gold is only $60 more than the current price for today ($939). It might rise up a bit, perhaps matching the 1000 or so maximum, but I think its hovering at about its peak right now. Going into gold now certainly violates the principles of buy low, sell high.

I'm betting that gold investors might feel protected for a year or so, but prices will drop back down to lower levels, making this a bad long term investment at these prices. Better to just hold onto cash than put it in to gold in my opinion.



I saw my fund lose about 40% of its value, which was a big hit.I'm currently at 58% of my value from a year ago. The total value now is actually less than my actual contributions since I opened the fund, completely eliminating all interest earned in the 13 or so years I've had it.

[Mr. P]

Honestly, I've never understood the big deal about gold. So what it you have a bar to trade? Might as well be a bar of soap you, can't eat either.

Maybe someone can explain the value I just don't see.

[DannyR]

Honestly, I've never understood the big deal about gold. So what it you have a bar to trade? Might as well be a bar of soap you, can't eat either.

Maybe someone can explain the value I just don't see.It is a commodity like any other. Its scarcity and multiple uses make it valuable, but its use as a method of payment throughout time is what draw people to wanting to hold onto it during times when other forms of payment might not be as valuable.

Our cash after all is based on the "good faith" of the government. If that faith disappears, so does the value of our cash. Gold however holds its value despite any single government's existence. Its a coin valuable throughout the world.

[Mr. P]

It is a commodity like any other. Its scarcity and multiple uses make it valuable, but its use as a method of payment throughout time is what draw people to wanting to hold onto it during times when other forms of payment might not be as valuable.

Our cash after all is based on the "good faith" of the government. If that faith disappears, so does the value of our cash. Gold however holds its value despite any single government's existence. Its a coin valuable throughout the world.

I understand all that Danny, in a stable economy. What I don't understand is that some think in a collapse it'll be of value. IMO Food or a bar of soap would hold more value. What's anyone gonno do with a bar of gold? Like I said you can't eat it, someone that may accept it as payment can't eat it...it just doesn't make logical sense to use it as a hedge against total collapse. Makes perfect sense as a hedge against inflation.

On the other hand if you can collect gold during a collapse and still survive you'll be set when a recovery comes.

[namvet]

In mid October I moved all my 401 out of stocks. That was a good thing, I've actually made a bit back since.

Now, I'm giving serious though to pulling everything out, taking the penalty an paying the tax before the Gov., in desparation, takes it or it's all lost due to a total collapse.

Anyone else thinking along these lines? At least we'd have something in the mattress.

moved ALL mine overseas. nov 21