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Some questions about decisions in my 401k distributions and possibly rolling into a self directed fund


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Posted

I have a few questions and could use some guidance.  I have two fully vested 401ks currently with Voya.  I feel a recession is coming, perhaps a really bad one.  The inflation numbers just released were bad and the next jobs report is going to be horrific.  Tariffs are coming in the next few days.  All bad.  This week, I want to change how my 401k money is invested.  I had high yield positions which had been good, but I want get into something that is as close to cash as I can get for now.  There is a list of distribution options on the website, but their customer service was horrific and all in India.  If I gave you guys a list of my options, could you tell me which ones are the good, super, super low risk?  They are listed by their abbreviations on the website.  Each 401k has different options. Ideally, I would prefer to not distribute my money into something that requires my money to be there for like 3 or more months.  Because...

In the near term, I am also trying to decide if I should move my money into a self directed fund.  I would like some more control/options and perhaps be able to buy things that people buy in big Dow sell offs, like gold.  I might want to, perhaps, dip my toes in the crypto market. Yes, I know but I wonder if people might run to the crypto market instead of traditional things like gold this time. 

I have some big decisions to make and Voya was less than useless. 

 

Posted
1 hour ago, hornmpa96 said:

Your 401ks should have a money market option in the 401k. 

I don't see anything with money market in the name.  These are the categories for the two funds. Each category has one to 15 or so choices under it. 

1st Fund:

STABILITY OF PRINCIPAL
BONDS
ASSET ALLOCATION
LARGE CAP VALUE/BLEND
LARGE CAP GROWTH
SMALL/MID/SPECIALTY
GLOBAL/INTERNATIONAL

2nd Fund:

TARGET-DATE FUNDS
BONDS
BALANCED
LARGE CAP VALUE/BLEND
LARGE CAP GROWTH
SMALL/MID/SPECIALTY
GLOBAL/INTERNATIONAL

Do you know where I should be looking? 

Posted

These are my options. Each fund had different choices. The category is in bold, choices underneath. 

Fund A:

STABILITY OF PRINCIPAL

4450 Voya Fixed Account (4450) (My money has to stay here for 90 days before I could move to a self directed fund)


BONDS

2952 Nuveen Infl-Linked Bond Fnd R6    
3918 BlackRock High Yield Port K    
6931 Baird Aggregate Bond Fund Inst    
C428 BlackRock US Debt Index Fund R     
E754 Thornburg Strategic Income Fund R6

ASSET ALLOCATION

6034 flexPATH Index+ Conservative Ret R1    
6176 flexPATH Index+ Conservative 2035 R1
6563 flexPATH Index+ Conservative 2045 R1
6617 flexPATH Index+ Conservative 2055 R1
8545 flexPATH Index+ Aggressive Ret R1    
8563 flexPATH Index+ Aggressive 2035 R1
8564 flexPATH Index+ Aggressive 2045 R1
8573 flexPATH Index+ Aggressive 2055 R1
9684 flexPATH Index+ Moderate 2035 R1    
9685 flexPATH Index+ Moderate 2045 R1    
9686 flexPATH Index+ Moderate 2055 R1    
9687 flexPATH Index+ Moderate Ret R1    
F229 flexPATH Index+ Aggressive 2065 R1
F234 flexPATH Index+ Conservative 2065 R1
F239 flexPATH Index+ Moderate 2065 R1


LARGE CAP VALUE/BLEND

C975 Fidelity 500 Index Fund
D264 Large Cap Value Fund R1


LARGE CAP GROWTH

3494 JPMorgan Lrg Cp Growth Fnd R6


SMALL/MID/SPECIALTY

2566 DFA U.S. Targeted Value Port Inst
6593 Vanguard Info Tech Index Fnd Adm
6856 JPMorgan Mid Cap Growth Fund R6
8203 Virtus Duff & Phelps Real Est Sec R6
C698 Janus Hndrsn Gl Life Sciences Fund N
C993 Fidelity Sm Cp Ind Fund    
D122 Fidelity Mid Cap Index Fd
E645 BlkRck Md-Cp Value Fnd K
E750 Putnam Small Cap Growth Fund R6

 

GLOBAL/INTERNATIONAL

1913 DFA Emerging Mkts Core Eq 2-Inst
C427 BlackRock EAFE Equity Index Fund R
E601 Putnam International Value Fund R6
E752 International Equity Fund R1

 

Posted (edited)

Fund B:

TARGET-DATE FUNDS

VANG TR II INCOME
VANG TR II 2020
VANG TR II 2025
VANG TR II 2030
VANG TR II 2035
VANG TR II 2040
VANG TR II 2045
VANG TR II 2050
VANG TR II 2055
VANG TR II 2060
VANG TR II 2065
VANG TR II 2070

 

BONDS

PIMCO REAL RETURN TR
VANG TOT BOND MKT INST
PIONEER STRAT INC Y
VRTS S HIGH YIELD I

 

BALANCED

VANG WELLINGTON ADM

 

LARGE CAP VALUE/BLEND

VANG WINDSOR II ADM
VANGUARD INST INDEX
VANG PRIMECAP ADM

 

LARGE CAP GROWTH

VANG US GROWTH ADM

 

SMALL/MID/SPECIALTY

Vanguard Selected Value
IVY MID CAP GROWTH CIT C
DLWR SM CAP VAL INST
NATIONWIDE GENEVA SM CAP GRWTH
Cohen & Steers US Realty Class RS

 

GLOBAL/INTERNATIONAL

Vanguard Developed Markets Index Admiral
DFA Emerging Markets Core Equity
VANG EURO STK IDX INSTLl
STABLE VALUE OPTION  (My money has to stay here for 90 days before I could move to a self directed fund)

Edited by RabidM
Posted
30 minutes ago, hornmpa96 said:

It will be in the stability of principal in the first fund.

The second fund isn’t clear. I would check the bonds section first.

I put the full list of options in there. Are any of those money market funds? 

Posted
28 minutes ago, RabidM said:

I put the full list of options in there. Are any of those money market funds? 

Looking at those options, I realize that I really dislike Voya. My employers have always used either Fidelity or Vanguard as our 401k provider and it’s never looked that complicated.

I looked at an information sheet for the 4450 Voya Fixed Account and it mentioned the word “Annuity” which I didn’t really like. Someone may jump on me for this - however, when I see “annuity” I assume it comes with some kind of cost.

In Fund B, I’m guessing the Stable Value Option is the same as the Voya Fixed Account in Fund A.

Based on your list, it doesn’t appear that you have a simple money market option. 

Sorry I’m not more help.

  • Hook 'Em 1
Posted

Many years ago I had to set up a 401k for my company. I was stunned at the level of fees charged. Companies pay some, all, or none of those fees depending on the company. 

And these fees are very hidden from the employee. It’s hard to find them. As a result, over the years whenever I left a company I’d roll my 401k to a rollover IRA at a low cost broker, like Vanguard or Fidelity or Schwab. There is one IRS approved feature you lose by not having funds in a 401k vs a rollover IRA, but I can’t recall what it was or whether it’s important. I don’t think it was. Maybe someone on here knows. 

Once you’re in a rollover IRA at Fidelity, you can invest in anything with much lower fees. 

Posted (edited)

I'm leaning toward rolling into a self directed fund.  I want to get out of stock volatility this week though. This week could be really bad. Tariffs on Wed and job report on Friday and it was already trending down.  yikes

43 minutes ago, hornmpa96 said:

Looking at those options, I realize that I really dislike Voya. My employers have always used either Fidelity or Vanguard as our 401k provider and it’s never looked that complicated.

I looked at an information sheet for the 4450 Voya Fixed Account and it mentioned the word “Annuity” which I didn’t really like. Someone may jump on me for this - however, when I see “annuity” I assume it comes with some kind of cost.

In Fund B, I’m guessing the Stable Value Option is the same as the Voya Fixed Account in Fund A.

Based on your list, it doesn’t appear that you have a simple money market option. 

Sorry I’m not more help.

Thanks for looking.  I think the two might be my only options.  How large could the fees be? 

Edited by RabidM
Posted (edited)

Were there any other options in there with less market volatility to them?  How quickly could I get rolled into a self directed fund? 

If you notify Voya that you want to roll over into a new company, do they convert your funds to cash and hold them or do they stay in their current investment distributions? 

Edited by RabidM
Posted

I love how you started here
 

9 hours ago, RabidM said:

If I gave you guys a list of my options, could you tell me which ones are the good, super, super low risk? 

 And ended here

9 hours ago, RabidM said:

I would like some more control/options and perhaps be able to buy things that people buy in big Dow sell offs, like gold.  I might want to, perhaps, dip my toes in the crypto market.

 

 

  • Drool 1
Posted
51 minutes ago, Reynolds Woodcock said:

I love how you started here
 

 And ended here

 

 

That's a hunch on what might happen if the Dow completely crashes out.  It's something I'm watching.  

Unfortunately, I have struggled mightily in my life financially.  I don't have nearly enough saved to avoid being impoverished at some point.  I might need to take a risk to try and catch up.  I probably won't end up doing it, but I at least want the option to explore it. I am aware crypto is very, very risky/speculative. 

Posted (edited)
Posted

Right now crypto is tracking the nasdaq just with a higher beta. I too have thought about crypto and specifically bitcoin now that you can trade it in some brokerage accounts but it is super risky. I would be very careful thinking it will diverge from the direction of stocks.  If we get a 40% market crash bitcoin could crash 80%. It would be right at the bottom where you could have a ridiculous return in 2 years. But where is the bottom. That's the trick. For me personally I would never touch bitcion unless it goes back down to the 20-25k range. My fidelity and schwab account both allow for me to trade it. My vanguard account however does not.  

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Posted
13 hours ago, Dbeasy said:

There is one IRS approved feature you lose by not having funds in a 401k vs a rollover IRA, but I can’t recall what it was or whether it’s important. I don’t think it was. Maybe someone on here knows. 

The only one that I know is that if you separate from a company for which you have a 401k (or presumably 403b), you can withdrawal the funds from that 401k starting at 55 without penalty. The IRA non-penalty feature doesn't kick in until 59.5.

What I don't know is if the 401k funds, withdrawable without penalty, could have only been contributed at that job or whether rollover 401k funds also receive that benefit. It would be important to think this through and possibly transfer funds if you know you're leaving a company after 55.

  • Hook 'Em 1
Posted

There are 2 other issues with rolling 401k’s to Ira’s. First, it makes Backdoor Roth conversions (non-deductable Ira contributions that are then converted to Roth) non-viable, because of how the taxation is calculated. Second, Ira’s have less creditor protection than 401ks, which is stupid. 

For me neither of these issues was enough to not do it. I wanted the lower fees, better investment options, and higher control of having funds in the Ira instead of the 401k. Plus, I was with several companies so  I had many 401k’s. 

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Posted
53 minutes ago, Nice Guy Eddie said:

The only one that I know is that if you separate from a company for which you have a 401k (or presumably 403b), you can withdrawal the funds from that 401k starting at 55 without penalty. The IRA non-penalty feature doesn't kick in until 59.5.

What I don't know is if the 401k funds, withdrawable without penalty, could have only been contributed at that job or whether rollover 401k funds also receive that benefit. It would be important to think this through and possibly transfer funds if you know you're leaving a company after 55.

I’m fairly certain you can rollover prior employer 401k funds into your current employer’s 401k and eventually receiving the separation after 55 benefit (assuming your current employers plan allows for rollovers).

Posted
29 minutes ago, Larry T. Spider said:

@RabidM If you don’t mind sharing how old you are, or a general range, it might help some of our knowledgeable posters help you out a bit more.

I'm 49

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Posted
12 minutes ago, RabidM said:

I'm 49

I’m not a financial professional in any way but based on your age and statement that you don’t have nearly enough saved, you might not be as bad off as you think. 

I think you are young enough to still make a difference it the quality of retirement you are hoping for. Staying the course with consistent investing should have you well ahead over the next 15 years. If the market does take a big dip over the next year, buying at a discount could be the best thing for your financial future.
 

Of course that all depends on your individual situation and the amount you have to plow into the market each month. I’ll let the pros chime in with their take.

Posted

Most money market funds end with "XX," I don't think VOYA is an exception.
Stable Value funds are similar but usually give you a little more return, but will have requirements on how long they need to stay in the fund.

You will probably mess this up, the market will have already factored all your concerns in, and you will not buy back in at the bottom.

Posted
43 minutes ago, RabidM said:

I'm 49

My friend, you are not that old. You need to cut expenses and save in a disciplined manner to the max extent possible. The last thing you need to do is try to time the market or make a speculative bet on crypto. That is exactly how you make a bad situation worse. 

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