True Contrarian Investments LLC
Steven Jon Kaplan began TrueContrarian.com in August 1996 as a weekly blog and later expanded this to a daily newsletter with intraday updates in February 2006. He has been trading his own account, and those of family and close friends, since 1981, and handles separately managed accounts for qualified clients. As a registered investment advisor, Steve charges a 20 % performance fee on net profits and no management fees. He has been quoted in Barron's, Market Watch, Dow Jones Newswires, Seeking Alpha, Kitco, and elsewhere and has appeared on Market Watch cable TV with Stacey Delo.
Steven's goal is to identify those assets which are farthest away from the best estimates of their realistic fair-value levels. This is done through designing algorithms which examine the most reliable signals in the financial markets. These include insider buying relative to selling; investor inflows and outflows; media and advisors' sentiment; and intraday behavior especially near multi-decade tops and bottoms. He studies historical interrelationships to mathematically identify which divergences from typical behavior are pointing the way toward essential trend changes.
Steve enjoys running with the New York Road Runners Club, composing and performing on piano and voice, writing stories, and traveling to unique places. He enjoys hearing from anyone about a wide range of topics, so please let him know what you think about the web site or whatever is on your mind. You can find his music on ReverbNation.
BES, Electrical Engineering and Computer Science, The Johns Hopkins University
Assets Under Management:
20% of net profits; zero management fees.
True Contrarian Investments LLC
Steven Jon Kaplan explains why investors repeatedly fool themselves.
Steven Jon Kaplan: April 2010 conference
There is no reason to reduce your 401(k) contributions or to be concerned with the integrity or existence of your 401(k) accounts. They are fully viable regardless of whether or not you possess U.S. residence or citizenship. Your home country may impose taxes on your earnings from that account or based upon the value of that account, but you will have to check the rules with your home country. You can keep your money in your 401(k) as long as you like until you reach 70-1/2. At that point, if you are no longer working at the company with which the 401(k) was established, you must begin making required minimum distributions and paying U.S. taxes on them just like any U.S. resident must do. You can avoid this problem the same way that a U.S. resident can do, by gradually converting your 401(k) to a Roth IRA so that the entire amount is converted into a Roth IRA by the time you reach 70-1/2. That will prevent you from ever having to pay U.S. taxes afterward even if the account greatly increases in value or you make significant withdrawals.
You won't incur any tax liability. Since your personal Roth IRA has been in existence for more than five years, after you deposit both checks into it from your Roth 401(k), all of your money will be fully available to you with zero taxes. The holding period in the Roth 401(k) immediately changes to the holding period of your Roth IRA by IRS law.
A Roth IRA is almost certainly a superior choice to a traditional IRA. You are in a low tax bracket and you will do much better having fully tax-free income for life and no required minimum distributions. Look for conservative investments, even very conservative ones like a bank CD. There is no reason to start taking risks when the U.S. stock market is so high and we are probably starting the third major bear market since 2000. Many one-year bank CDs pay 1.6% if you shop around. Eventually stocks will be much cheaper and you can begin gradually buying them when most people you know are selling them in a panic.
Definitely not. If you get into the habit of using retirement accounts to pay off your expenses where you are living above your means, then you will remain behind for the rest of your life. Instead, concentrate on reducing your living expenses and possibly working overtime so that you can gradually pay off your credit-card debt. That way you will establish prudent habits which you can retain permanently.
I usually don't like to answer these kinds of questions since it reminds me of the games that kindergarten boys always play: would you rather get run over by an 18-wheel truck or be eaten by ten thousand fire ants.
In your situation, don't even think about trying to pay off the loan. Simply keep making the minimum possible payments each month. If they offer you a chance to make even smaller monthly payments, take it. Even if your loans end up stretching out until you're 120 years old, paying the monthly minimum makes sense because you are in a hopeless situation unless you marry a fabulously wealthy person.
At least if you do this then your living situation will be reasonably tolerable. You'll have your debt for the rest of your life, but so did Thomas Jefferson and he did okay.