Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
401a
Old 11-05-2006, 12:37 PM   #1
Recycles dryer sheets
 
Join Date: Dec 2002
Posts: 129
401a

The state of Arizona is planning to offer a 401a plan next year.

Right now the wife maxes out her 457 (from her employer a city) and does pension contributions thru state, but we still stash away about 4500/month post tax. Apparently this 401a allows her to put away up to 44k pretax, which sounds like a pretty solid deal for further reducing our taxable income. We're very likely in the "lower tax bracket post retirement" group so my first impulse is to make sure we've got enough to fund our Roths and pile the rest into this 401a.

They didn't have much more information and I did some cursory googling but was hoping some of the wise ones that frequent this forum have more info, insight, or warnings on 401as. I've never heard of one before reading the state retirement newsletter.
__________________

__________________
WRBT is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Re: 401a
Old 11-05-2006, 12:58 PM   #2
Moderator Emeritus
Martha's Avatar
 
Join Date: Feb 2004
Location: minnesota
Posts: 13,212
Re: 401a

I don't know much about 401a plans, but if I recall correctly although employers can put a bunch of money in for their employees pretax (up to $45,000 in 2007), there are circumstances where any employee contributions if allowed are post tax, not pre-tax. It may be that the employer has the option to decide what kind of employee contributions to allow. I do know that there are at least some of these plans which only allow post tax employee contributions.


I think the 401a plans are very flexible from an employer standpoint so it would also be nice to know how your employer intends on calculating the amount of money it will contribute to the plan on your wife's behalf.

EDIT: Also, these can be either defined benefit or defined contribution plans, so be sure you know what you are getting.



__________________

__________________
.


No more lawyer stuff, no more political stuff, so no more CYA

Martha is offline   Reply With Quote
Re: 401a
Old 11-05-2006, 01:43 PM   #3
Recycles dryer sheets
 
Join Date: Dec 2002
Posts: 129
Re: 401a

Yeah that's what caused googling to be of little help, it seems a 401a can be all sorts of things.

The blurb in the newsletter says it's defined contribution, and it blathers on about a three pronged retirement solution of the 401a, the pension, and ss. From what I can gather they aren't contributing jack, it's all employee.

Perhaps I should wait until more specific literature comes out.
__________________
WRBT is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
401a rollover?? SlowTwitcher FIRE and Money 6 11-26-2006 10:44 AM

 

 
All times are GMT -6. The time now is 10:35 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.