Bobbie, here's one from T
Dan, once you get a $1000 saved in your account (taxable or ROTH) you can invest in one of Vanguard's target date funds. Most of heir other funds have at least $3K minimums.
Phil, HSA accounts will differ as much as brokerage accounts differ. Some are open platform and others have a limited selection of investments. Some offer bank savings options and others do not. I personally use HSA Bank which has an investment option with TD Ameritrade. I keep half of my money in the banks savings account and the other half in the investment account.
Alright Matt, here's one final question for you.
From International School
NO, an inherited IRA must be taken out annually over your beneficiaries lifetime and that applies to an inherited 401(k) which would be rolled over at your death. It can be withdrawn all at once, but the minimum according to IRS tables must be withdrawn annuallyThis is a relatively new expanded rule for non spouse beneficiaries that was passed in 2007.
Debbie, time for one more?
all the time in the world
International School, I'm not sure what you mean by avoiding the penalty. The one situation that I can think of would be if you've had a Roth IRA opened for more than 5 years but there are complications to this scenario as well. Do you have any more info for me? A 10% penalty is a pretty big hit and I would guess you could get a loan for less than this amount.
Great! Here's one from Dylan
Signing off...I look forward to the next one!
Thanks for joining us, Matt! See you next time
Dylan, it is true that many American's are drowning in debt. I would not use any retirement resources for debt payments. The school loans are being paid monthly I assume? The credit card debt is what you need to tackle first. Make a list of your credit cards, interest charged and balance. Pay the highest credit card in terms of interest rates in the most aggressive way you can afford. Do not close any of the cards when they are paid off, it may lower your credit score. I also would consider putting off buying a house as you will need to save more for that purpose. Really scrutinize your monthly expenses to see where you might be able to find a few bucks to use to pay more aggressively on your cards. Resist the temptation to switch cards to 0% interest, etc.
Thanks, Debbie. We'll let you finish up with this last question from Manoj.
Manoj, look back through the transcript here for an answer from Jane Clark. 9Short answer: It doesn't hurt you much if 529 is in your name.) Also look for a link I embedded to a list of assets that affect financial-aid formulas.
529 plans are the asset of the owner for financial aide calculations, so as the parent, it will have little impact.
Well said, Robert and Debbie :)
Alright, I think it's time to wrap up the chat and let the advisors get back to work.
Again, our sincerest apologies to all of you who did not get your questions answered. Due to the high volume, we simply couldn't get to them all.
Thanks for steering us, Amanda.
The good news is that you can join Kiplinger and NAPFA again next month, on July 19 from 1pm-3pm ET for another live chat. We'll hold onto some of these questions and will re-submit them then.
Great moderating. Wonderful participation and fun experience.
Thanks, Debbie! Wonderful advice!
We appreciate you being here and hope you'll join us again!
Thanks again, all! See you next time.
We were so pleased with the active participation in last week’s Jump-Start chat that we have invited the NAPFA planners back for another hour of live Q&A on Thursday, June 21 from 1pm-2pm. We will continue answering questions that were submitted on June 14, and will get to as many of them as possible. Tune in then.
Welcome to today’s Jump-Start Your Financial Plan live chat! We had such a large influx of questions last week, that we decided to invite the NAPFA planners back for another hour of Q&A.
Hello, I'm Bobbie Munroe CFP, a fee-only, NAPFA registered financial planner. I work from Atlanta, GA and Tallahassee, FL. I look forward to working with all of you today and I thank Kiplinger for this opportunity to serve the community.
We have three NAPFA advisors with us this afternoon: Bobbie Munroe of Fraser Financial in Atlanta, GA; Debbie Frazier of Frazier Financial Consultants in Chapel Hill, NC; and David John Marotta of Marotta Wealth Management in Charlottesville, VA. Thanks for being here, all!
We will get started with the questions that were submitted last week, and will try to get through as many of them as possible.
Bobbie, how about you take our first question from Jess K.
And David, here's one for you from Tom.
Jess, I work with a lot of younger adults as starting early is the best path to financial success. At your age, I would consider openning a ROTH IRA and funding it up to $5K per year. You can start with Vanguard as they have target date funds (a great mix of stocks--domestic and international--and fixed income). You would probably use something like the Vanguard 2055 fund....$1K minimum investment. BUT before you invest anything, you need an emergency fund. Very boring and it won't earn hardly anything in this environment. But I would love for you to have AT LEAST 3 months of living expenses saved up before you start investing.
