401k after retirement

[Big_Hitter]

Yup, 2% with no interest rate risk and negligible credit risk isn't too bad.

have you ever been involved in re-negotiating or changing GIC vendors? my FA told me a horror story of how one was devalued about 25% during one such change. I've never heard of any huge defaults on GICS other than one back in the 80s.

 

[sengsational]

Typical. The OP joined a week ago, posted one question, and has not visited the forum since that day.

Meanwhile, 20 people have striven to provide incisive answers to guide his/her thinking.

Sigh.

Even though the OP might never see the responses, we all poke around at the basics and the nuances to educate each other and to all of the Googler lurkers. It's still goodness

 

[tmm99]

Even though the OP might never see the responses, we all poke around at the basics and the nuances to educate each other and to all of the Googler lurkers. It's still goodness

Yep, I agree. There are others who are benefitting from this. And it's good brain exercise for the poster's.

 

[Big_Hitter]

Even though the OP might never see the responses, we all poke around at the basics and the nuances to educate each other and to all of the Googler lurkers. It's still goodness

+1 - that's how knowledge is emanated

 

[pb4uski]

have you ever been involved in re-negotiating or changing GIC vendors? my FA told me a horror story of how one was devalued about 25% during one such change. I've never heard of any huge defaults on GICS other than one back in the 80s.

No, never. Never heard of any huge wrap defaults either.... I'm guessing that perhaps you are thinking of Executive Life back in 1991?

Counterparty risk of the wrap provider is definitely a risk though.

 

[jazz4cash]

I would gleefully pay $50/yr and $25/distribution to have access to a good stable value fund.

Now that you put that way it's a tiny fee and maybe I jumped the gun. My thinking was that it was just not worth it to me.....

• I kept the other 401k open since it also has stable value and megacorp continues to pickup the fees

• My main allocation of fixed income assets is CDs which are still almost double what the SVF pays. If CDs keep dropping I may need to re-allocate those funds to the SVF. That means I must have other funds (Equity Index) in the 401k to balance out of. Always be movin the cheese.

 

[Big_Hitter]

No, never. Never heard on any huge wrap defaults either.... I'm guessing that perhaps you are thinking of Executive Life back in 1991?

yes that's it - every investment has a risk premium, even GICs

 

[HI Bill]

This is actually significant if you are planning to retire at 55. It would be horrible to move your money, and then have to pay penalties to get to it. Whereas had it stayed in the 401k no penalties at all...

+1. I'm planning to work until my 55th birthday, and am considering how many IRA funds to roll into the 401(k) prior to hitting the RE button. Since I only have to worry about 4.5 years, I'll probably just add a year's expenses worth of investments to the 401(k) just to be safe.

 

[vdesalvo]

401k Fees

RxGrad98, one thing to look at before you move your 401k funds to a different account is the fees. Most employers account fees are minimal and advisor fees are .75 to 1% which will add up especially when the market is like now.

 

[RunningBum]

RxGrad98, one thing to look at before you move your 401k funds to a different account is the fees. Most employers account fees are minimal and advisor fees are .75 to 1% which will add up especially when the market is like now.

So don't use an advisor.

 

[ut2sua]

I/We still have 25% of investment funds in my 401k due to the Stable Value choice.
Too bad, I didn't realize just how good a fund this is, as would have moved some other monies in there while still working.

My 401k plan is with Fido. Stable Value fund ER ~0.43%, turn over rate ~59% . I thought it looks pretty bad. Could you share some details on yours? I may have missed the good side of my plan fund(?)

 

[NextInLine]

I would gleefully pay $50/yr and $25/distribution to have access to a good stable value fund.

Can anyone recommend few good stable value funds? Prefer Vanguard funds.

 

[Dtail]

My 401k plan is with Fido. Stable Value fund ER ~0.43%, turn over rate ~59% . I thought it looks pretty bad. Could you share some details on yours? I may have missed the good side of my plan fund(?)

The SVF is administered by Mass Mutual. It currently yields a gross of 4.01% with fees of 14 bps for a net yield of 3.87%.
I believe any distribution have a flat fee of $40, but no reason for any distributions now.

This SVF has in general yielded more than the typical SVF. I know a decent portion of the fund is invested in asset backed securities.

 

[Big_Hitter]

Can anyone recommend few good stable value funds? Prefer Vanguard funds.

those are generally available only an institutional 401k-type savings plans

ours is managed by troweprice

 

[ut2sua]

The SVF is administered by Mass Mutual. It currently yields a gross of 4.01% with fees of 14 bps for a net yield of 3.87%.
I believe any distribution have a flat fee of $40, but no reason for any distributions now.

This SVF has in general yielded more than the typical SVF. I know a decent portion of the fund is invested in asset backed securities.

Yes. That looks very good in today yield environment. Thanks for the details.