Excerpt from the book 'The Stockopoly Plan'. by the author Charles M. O'Melia I’ve been in and interested in the stock market so long (one year shy of forty years) I can remember when the Mutual Fund pages in my home town paper were just one page!....
401(k) Plans
by: Charles M. O'Melia
Excerpt from the book 'The Stockopoly Plan'. by the author Charles M. O'Melia I’ve been in and interested in the stock market so long (one year shy of forty years) I can remember when the Mutual Fund pages in my home town paper were just one page! (The DOW was under 700.) Now it looks like there are more Mutual Funds then there are stocks listed on the New York stock exchange. I wonder how many billions of investor dollars are supporting these funds. How many investor dollars are supporting all the brokerage firms? How many times has 401(k) monies been given to a ‘financial expert’ to manage after retirement, then three years later the $400,000 is down to $200.000 (Yet, the financial expert is still driving around in a new Lexus). I could tell you stories from the people I know, who have retired and aren’t so happy with these experts, but I bet you know some stories of your own. (Why, I bet I could even write a book on the subject!) Do you know what you’re going to do with your 401(k) money when you retire? If you are going to hand it over to a financial expert to manage, see if you can get the names of some of his/her clients. See if you can call some of the expert’s clients, tell them what you’re planning to do and ask them if they’re satisfied with the expert’s performance. Or you could talk to those people you’ve once worked with, have retired, and went with a financial advisor or planner. Try to get some reference from a live body that has already been there, rather than just a bunch of statistics thrown at you by the expert. Today’s 401(k) plans are excellent vehicles for saving money and here’s what I like about mine: I like the 10 percent contribution being a tax write-off (some plans, sixteen percent). I can contribute up to 16 percent, but 6 percent would have to be after-taxed dollars. I like that the monies made in a 401(k) are tax-deferred. I like the company’s 70 to 100 percent company match (it differs every year with my company) up to 6 percent of my contribution. I like the option to move my money (every business day, if I wished) into my company’s stock or an Interest Income fund, Bond fund, Mutual fund or Index fund, at no cost. I like the option to roll-over into an individual IRA account, twice a year, any after-tax and company matched dollars put into my 401(k), with no penalties or fees, even while I am still employed with the company. This allows me to select individual stocks and allows the dividends from those stocks to be rolled-over automatically into more shares of each company, also at no cost. (However, there are commission fees for the purchases of the stock. Dividend purchases only are commission-free. In my book 'The Stockopoly Plan' I explain how to purchase stocks commission free.) I like that the company’s dividends in my IRA (set up by monies from my 401(k) plan) are also tax-deferred and are 85% tax free. I like knowing that when my retirement day arrives, I’ll already have an individual IRA set up to move the rest of the 401(k) monies into, with twelve stocks already chosen, owned and proven to provide reliable ever-increasing dividend income. (The companies owned all have a history of raising their dividends every year.) I like the free 1% the company gives me, just for being in the 401(k) plan. I like the option to borrow money from my 401(k) plan, pay a low interest rate on the loan and know that the interest rate I’m paying on the loan goes to me (if I were paying a credit card bill of $3,000.00 at 18%, I know I have the option to pay off the high interest credit card loan and pay only 6% interest (to myself) on the $3000.00 loan from my 401(k). I like knowing that when I move the rest of my 401(k) monies into my IRA when I retire, I’ll know about how much income I can reasonably expect in dividend income four times a month, twelve months a year (all twelve stocks have staggered dividend pay-out dates, providing cash dividends every week of the year). The companies chosen in my IRA, with their history of raising dividends every year, will provide the comfortable, worry-free income which I believe investing should be all about. My advice on 401(k) plans is to talk to an expert from the firm your 401(k) monies are with and find out what options are available to you and/or what your company allows. My point was simply to inform you that you may not be restricted to just putting your money into a Mutual fund or your company’s stock. You can transfer monies from your 401(k) to an individual IRA (Tradition, Roll-Over or Roth), at no fee and build your own Mutual fund. (I have been doing this in my 401(k) plan for years while still employed with my company.) If those companies you choose in your IRA have a dividend reinvestment plan you can request to have the dividends reinvested back into the stock each quarter. And this would be done for you, commission-free. For more info on 'The Stockopoly Plan'
visit www.thestockopolyplan.com
About The Author
Charles M. O'Melia is an individual investor with almost 40 years of experience and passion for the stock market. Author of the book 'The Stockopoly Plan' soon to be released by American Book Publishing.
(NC)-As the first smog alert warnings of the season approach, Canadians are being urged to use ethanol-blended fuel to alleviate the urban smog problems plaguing many parts of the country. Many regions such Vancouver, Calgary, Montreal and most pa....
Read more
Low Speed impacts are those that take pace at speeds under 10 MPH. There’s often little (if any) visible Property Damage done to the rear of ones motor vehicle. However, those who are struck (especially in the rear) often have injuries, especially....
Read more
Remember back when selling online was a new experience? Dealers tried everything to sell their vehicles online. Today’s market has expanded to include several hot online marketplaces but there is the largest online marketplace, Ebay. Ebay has e....
Read more
Remember back when selling online was a new experience? Dealers tried everything to sell their vehicles online. Today’s market has expanded to include several hot online marketplaces. The largest online marketplace is Ebay. Ebay has evolved in....
Read more
What does BPU™ stand for? (BPU™ is a trademark of SupraStore.com)Basic Performance Upgrades. These modifications are: A full length three inch down-pipe (with or with-out high flow cats), 3” (75mm) or bigger cat-back exhaust system, raised boost....
Read more
