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Old 09-19-2012, 12:09 PM   #41
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If any of the money is in tax defered accounts (IRA) have him roll it to a beneficiary account. Otherwise taxes have to paid when it's cashed out.

Too many people get hit with a big tax bill because they don't realize the generational aspect of an IRA inheritance.

I get (small) annual RMDs from it - but can start drawing down (and paying taxes as I withdraw) to help cover the period between retirement and 59.5 when I can tap my own IRA/401k funds.

It's a nice way to spread the taxes out into lower income years rather than having a big chunk taxed at the max amount.

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Old 09-20-2012, 06:42 AM   #42
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Thank you for the replies and advice. I also need to ask my friend what his 457(b) account is invested in to get a better idea of what his overall AA is. (His record-kepping is a littl spotty, so I hope he has a recent account statement.)

Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.

"I want my money working for me instead of me working for my money!"
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Old 09-20-2012, 12:49 PM   #43
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Reminds me of a scene from one of my favorite business-related movies~Glengarry Glen Ross.

ABC~Get them to sign..

You drove a Hyundai to get here. I drove an eighty-thousand dollar BMW. THAT'S my name. And your name is you're wanting. You can't play in the man's game, you can't close them - go home and tell your wife your troubles. Because only one thing counts in this life: Get them to sign on the line which is dotted. You hear me you f**king faggots? A-B-C. A-Always, Be, C-Closing. Always be closing. ALWAYS BE CLOSING. A-I-D-A. Attention, Interest, Decision, Action. Attention - Do I have you attention? Interest - Are you interested? I know you are, because it's f**k or walk. You close or you hit the bricks. Decision - Have you made your decision, for Christ? And Action. A-I-D-A. Get out there - you got the prospects coming in. You think they came in to get out of the rain? A guy don't walk on the lot lest he wants to buy. They're sitting out there waiting to give you their money. Are you gonna take it? Are you man enough to take it? What's the problem, pal?
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Old 09-20-2012, 03:13 PM   #44
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Old 11-18-2012, 10:53 AM   #45
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An update on my friend's inheritance.

His mom's brokerage accounts and IRA contain alot of corporate bonds and shares of stock in addition to a large blob of cash, presumably from the interest and dividends the bonds and cash spun off over the years.

He and his sister agreed to a split of the stocks and bonds (and some other smaller assets such as mutual funds and CDs) to minimize his sister's husband's issues with obtaining individual stocks (he works in financial servies so he needs approval ot own such shares) so he should have his share in an account in his name in a week or so.

From there, he and I will visit our local Fidelity rep to open a brokerage account and an IRA, directly transferring the stocks and bonds to these new accounts. With the brokerage account's cash, he will use it to pay off his mortgage and have a little cash left over.

I don't think my friend should allow any large cash buildup of the interest and dividends coming from the stocks and bonds (in both the brokerage and IRA accounts), instead investing at least some of that into something mroe flexible such as mutual funds (stock or bond, not sure). I agree that he should set aside some of this new income stream into something safe and liquid (CDs?) but also remember that he will have more of his wage income available to invest elsewhere once the mortgage gets paid off (which I think was ERD50's point in an earlier post).

I was looking at Fidelity's Cash Management service (for him) which acts as a hub for other Fidelity investments as well as his own bank's checking account. Has anyone here used that service and what do you think of that?
Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.

"I want my money working for me instead of me working for my money!"
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Old 11-18-2012, 01:52 PM   #46
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I use the Fidelity cash management account as my main checking account. The connected BillPay is used to pay all the bills that I can, automatically if possible. I can transfer cash from brokerage accounts as needed to fund spending. I can transfer to our local banks if needed (cashier's check), or from our banks to Fidelity. Any ATM fees are refunded quickly and automatically, so I can use the grocery store's ATM. I can make large charges to the checking account and let the automatic overflow and minimum balance transfers restore my checking balance. It's pretty cool, and free.

On the flip side, if your account number ends up in the wrong hands, it potentially exposes brokerage assets as well as the checking account.
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Old 11-18-2012, 05:43 PM   #47
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Originally Posted by samclem View Post
The basics of saving/investing/money management should definitely be taught in school. It's been much more useful to me than the trig identities and diagramming sentences.
Eh! For me, without those trig identities (which I still remember and use) and other "math stuff", I would not have much money to invest and to manage. There are different ways to make money, but it is the only way I know. How did a fool and his money get together in the first place? People do not talk about a fool who never has any money.

I'll say we need to learn both to make money and to keep it.

"Old age is the most unexpected of all things that can happen to a man" -- Leo Tolstoy
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