doraflood
Confused about dryer sheets
I'm 49 and was laid off 2 years ago after 20 years -- final unemployment check to be received in about 3 weeks. From work, I have about $50k in a cash 403b account that is only earning about 2%. I have about $80k in a fidelity 403b which is doing much, much better.
I've been hurt in the job market because I never completed my bachelors (in accounting), and quite frankly, I would rather do hotel management and have the opportunity to travel. What can I say, I love hotels!
My thoughts (plan?) is to move the $50k to a new account and withdrawl the needed net $2500/mo for living expenses. I know I'll have to pay the 10% penalty -- I'm not worried about the income taxes as I will be in a low tax bracket as this, plus a $10k a year consulting contract, will be my only source of income. So I think I can milk this for 1.5-2 years -- the time it will take to finish my degree.
Questions:
A) As I'm only 49, is the money directly used for education expenses, exempt from 10% penalty?
B) I'm not good at managing investments. <blush> -- so I'm thinking of rolling over the $50k to a portfolio account (i.e. mutual fund) similar to what I have the other retirement funds in fidelity. Of course, I want the best fees, good return, and not outright crazy risk -- but would like to put the money in an aggressive account that will pay me more than the .01% the Chase IRA account would earn!
c) I've looked into just taking out a loan for school -- BUT because of my single, independent income over the last two year -- I wouldn't qualify for a guaranteed student loan -- so I would be looking at a > than 6% compounding interest loan -- which would end up costing more than the 10% penalty in the long run. I think I would be better off taking the money I would have been using to payoff the loan after school and replenishing my retirement income.
Help. Is my reasoning sound? I hate drawing down what little retirement I have but think it's the best option. Does investing with Fidelity, rather than Chase make sense? Thoughts?!
I know how to add 2+2 - but investments, oy vey!
I've been hurt in the job market because I never completed my bachelors (in accounting), and quite frankly, I would rather do hotel management and have the opportunity to travel. What can I say, I love hotels!
My thoughts (plan?) is to move the $50k to a new account and withdrawl the needed net $2500/mo for living expenses. I know I'll have to pay the 10% penalty -- I'm not worried about the income taxes as I will be in a low tax bracket as this, plus a $10k a year consulting contract, will be my only source of income. So I think I can milk this for 1.5-2 years -- the time it will take to finish my degree.
Questions:
A) As I'm only 49, is the money directly used for education expenses, exempt from 10% penalty?
B) I'm not good at managing investments. <blush> -- so I'm thinking of rolling over the $50k to a portfolio account (i.e. mutual fund) similar to what I have the other retirement funds in fidelity. Of course, I want the best fees, good return, and not outright crazy risk -- but would like to put the money in an aggressive account that will pay me more than the .01% the Chase IRA account would earn!
c) I've looked into just taking out a loan for school -- BUT because of my single, independent income over the last two year -- I wouldn't qualify for a guaranteed student loan -- so I would be looking at a > than 6% compounding interest loan -- which would end up costing more than the 10% penalty in the long run. I think I would be better off taking the money I would have been using to payoff the loan after school and replenishing my retirement income.
Help. Is my reasoning sound? I hate drawing down what little retirement I have but think it's the best option. Does investing with Fidelity, rather than Chase make sense? Thoughts?!
I know how to add 2+2 - but investments, oy vey!