The Financial Quarterback™
The Financial Quarterback™
Years ago Richard Reyes was working diligently doing his job as an investment advisor, wealth manager, or financial planner (he was never sure what to call himself back then). As far as he understood it, his job was to search for investments that would generate above average returns for his clients. That’s what the entire industry was built on and really, that’s what clients thought they hired him to do. Now think about this for a moment…the entire industry is based on the idea that their job is to find the best investments, and in the process, they are “killing the investor” and keeping YOU from meeting the challenges of being able to retire and stay retired.
When Richard realized these implications, his entire job and mission changed. He realized that investment success is not at all about skill—it is about having a process, a plan, and good behavior. Financial planning does not end nor begin with the words, “Buy, Sell or Hold.” His real job and passion is to help YOU create sleep well at night solutions in order to not only help you retire, but to make sure YOU stay retired.
Richard received his formal education at the University of Florida and completed the Certified Financial Planner Professional Education Program at the University of Central Florida. In addition to his professional qualifications, he is active in the local community and have served in ministries, associations and community organizations. He is frequently asked to speak and teach workshops on various financial topics to corporate groups, individuals, professional organizations and business owners.
He has contributed in authoring portions to the following books titled The Dirty, Filthy Lies My Broker Taught Me and 101 Truths about Money and Investing, The Complete Guide to Investing in Annuities, and The Mutual Funds Book and have been published in various magazines, newspapers, and local television such as Fox 35, Real Estate Broker Agent, Senior Advisor Magazine, Seminole Success, Orlando Business Journal, and Central Florida Business, Wall Street Journal, BankRate.com, and various others.
Richard is married to a fabulous wife, Marcia and have two wonderful boys. Lastly, they make their home in the #1 city as named by Money Magazine – Lake Mary, Florida.
BS, Construction Management, University of Florida
Assets Under Management:
Richard E. Reyes, CFP Retirement Florida - Let me tell you what we do
Thank you for your question.
You can definitely use the money from your 401k to pay down your debt. There is a variety of ways to pay down debt which are better than using your 401k because that will be your most expensive route. However, lets stick to the 401k alone.
1) You can take a loan from the plan if available to pay down your debt. Some plans do not allow this. In addition, you will have to pay the loan back over a certain amount of time depending on what your paln allows. You must understand that if you lose your job, this will no longer be a loan and will be taxable immediatedly in the same year which will mean you will owe taxes and 10% penalty if you are under 59 1/2.
2) You can take a regular withdraw or hardship withdraw. The amount you withdraw is fully taxable in that year plus you will have a 10% penalty if under 59 1/2. This is your most espensive way and often times they do not allow you to contribute for a period of time since if you take a hardship withdraw then it does make sense that you are saving at the same time.
3) You can stop contributing and just double up on payments to your debt. This is the best solution if you think you will be diligent enough to get it done right away and begin saving again after the debt is paid.
Hope this helps you out some. Good luck!
Richard E. Reyes, CFP, The Financial Quarterback TM
I hope I can help you. Understand that this is a loaded question and in order to provide you with real prudent advice an advisor would need A LOT more information. With that being said, it often depends what stage of life you are in and what phase of retirement you are in. Also where your income in retiement is coming from is important.
If you are truly receiving a rollover it should go directly from Trustee-to-Trustee so that there isn't any tax consequences. However, if you are not doing it this way taxes will be due in the year the income is received. In addition, if you are not yet over 59 1/2, you will also pay a 10% penalty.
If you are indeed retired and need this money for immediate income (whether it be now or even 10 years from now) I would look into fixed or income annuities to protect your income. If you dont have real need for this money any time soon (more than 10 years or ever) than you could actually expose to more risk and possibly invest into a low-cost global portoflio of index funds.
This is pure general advice but at least it gives you something to think about.
Hope this helps!
Richard Reyes, CFP, The Financial Quarterback TM
Gifts are not a tax deduction. They "might" calssify as a dependent if this support is over half of the relatives support. In addition, to classsify a as a dependent they must either be a US Citizen, US National, or a resident of the United States, Canada, or Mexico. However, let me remind you that this is for 2017 only. We don't have a clear indication of what the new tax bill will be.
Hope this helps.
Richard Reyes, CFP, www.TheFinancialQB.com
If you switch jobs your past salary inforamtion remains with the past employer and that employer has no legal responsibility to notify the new employer so therefore your new employer will not know and has to continue withholding even if you will overcontribute. You can contact your new payroll department and explain the situation and perhaps they will adjust and cease the withholding. However, if you do overpay, you will just claim a credit on your tax return the following year and get back your overcontribution.
Hope this helps.
Richard E. Reyes, CFP, The Financial Quarterback
I would definitely use the advantages on a 401k as part of your overall retirement planning especially if their is match. Not understanding your specific situation, I would recommend that at the very least you make max contributions into the Roth 401k side of the plan and at the very least into the future when you do indeed retire you know that money will be tax free. Your employer match will be in the traditional 401k side and will grow tax deferred until you begin to take distributions. Overall there is no negative for you to make contributions.