Conference nyoss1::market_investing

    re: .0
    
    I wasn't aware that you had any choice.  Are you saying the company is
    offering to pay out your pension now?  The folks I know who left
    recently weren't given that option, unless the current value of the
    pension was less than $3000 or so (which is rather unlikely in your
    case).
    
    	Steve

    
    	Cathy -
    
    	I think you are talking about your 401 (k) bucks. Digital does not
    allow you to take your pension out as a lump sum unless it has a value
    of less than $3500.
    
    	I'd take the 401 (k) and roll it into a self-directed IRA. Then I'd
    put 40% into a fund like Vanguard Index 500, 20% into a good
    International Fund, 20% into agressive growth, and 20% into a first
    class bond fund.
    
    	The only tax rule of any importance is that the funds from Digital
    be sent directly to your rollover account, do not have a check made out
    to you. The grief will be endless...
    
    		the Greyhawk

Here are some assorted thoughts,...

(Assuming that we are talking about the SAVE Plan money here)

When your SAVE plan balance is greater than $3500, then you
have the option of leaving the money in the SAVE Plan, or
taking the money out.  If your balance is below $3500, then
you don't have a choice -- the money is coming out.
So, for the purposes of discussion, I assume that you have
more than $3500.

I seem to remember that there is some advantage to keeping
the came-from-a-401k in an IRA separate from other IRA
accounts, but I don't remember the specifics.  Somehow it
is simpler later on if you want to add to the IRA.

The check from Digital must be made payable to the IRA
rollover account, and not to you.  If it is made out to you,
then a significant portion (20%) is withheld by Uncle Sam.

I have wondered, though, if Digital will only write one
check.  What if you wanted to put 1/2 the money into a
Vanguard Fund, and 1/2 into a T. Rowe Price fund.  Anybody
ever asked this?

A question to consider is, what are the 401k/IRA choices
after leaving Digital?  (Assuming you are moving to another
company), if the other company, for instance, does not have
a small company fund as a 401k choice, you could put the
money from SAVE into a small company fund in your IRA.  This
way, you'll be able to make up for any deficiency in the
new company's plan.  Or, if the growth fund that is offered
is a lousy one, then you could put the SAVE money into a
growth fund you like.  Anyway, it's something to consider.

Once you have your choice narrowed down to a few funds, call
the funds' 1-800 numbers, and tell them you want info for
an IRA rollover account.  That info should help too.

-Austin

>I seem to remember that there is some advantage to keeping
>the came-from-a-401k in an IRA separate from other IRA
>accounts, but I don't remember the specifics.  Somehow it

If I remember correctly, this has to do with the ease of putting the money 
into another 401k later on if the option becomes available.

				SQ

     I think .0 refered to the actual pension plan not 401K.
    
     So do I fin out how much I have accum. in the Digital pension
     plan? Not BE right?

    
    If you go the IRA route.  Set up a "rollover IRA" separate from your
    other IRAs.  You can then put the money back into a 401k at another
    firm if you want to.  Once the money is mingled with regular IRA money
    it is considered IRA money.  So far 401ks have more favorable terms
    than IRAs (about borrowing, withdrawals, etc) so keeping it separate is
    probably to your advantage.
    
    Greg
      

	BTW, check your mail today, things are a changing signficantly!
	In the mail today from Digital is info on the new "Cash Account
	Pension Plan", which I've only had a chance to read the summary
	on so far but here's one of the features:

		. It's flexible and portable.  If you're vested when you
		  leave Digital, you can elect to receive your account
		  balance in a lump sum or other payment form regardless
		  of your age.  Alternatively you may opt to leave your
		  balance in the plan or roll it over into SAVE, an IRA,
		  or another employer's plan.

	I'll look for an existing topic or start a new one (if someone
	hasn't a new one already) in the Digital_Investing conference
	where further discussion on this new plan is appropriate.

    One advantage of a 401K or 403B over an IRA is that if you're ever
    sued and lose, they can get your money from an IRA to settle the
    judgement if you don't have other assets to cover the judgement.
    Filing bankruptcy doesn't help.

    They can't get money from your 401K or 403B.  In addition, you have
    to pay the government taxes and penalties for the money from your
    IRA.  Apparently this is one difference between qualified and
    unqualified retirement plans.

    In this litigation happy country we live in, that's a fairly strong
    reason for leaving your money in a 401K or 403B plan.

    >   One advantage of a 401K or 403B over an IRA is that if you're ever
    >    sued and lose, they can get your money from an IRA to settle the
    >    judgement if you don't have other assets to cover the judgement.
    >    Filing bankruptcy doesn't help.
    
    In 1992 the Supreme Court ruled IRA money is exempt from bankruptcy
    seizure according to a WSJ article.  Is your information more current
    than that?  Is there a legal opinion somewhere within the sound of this
    voice?
    

    Re: .9 see p. 180 of Fortune, 12/25/95
    
    "If you declare bankruptcy, your 401k is harder to get at than an IRA"
    
    Gim
    
    

RE: .9
>>  One advantage of a 401K or 403B over an IRA is that if you're ever
>>  sued and lose, they can get your money from an IRA to settle the
>>  judgement if you don't have other assets to cover the judgement.
>>  Filing bankruptcy doesn't help.
>
>   In 1992 the Supreme Court ruled IRA money is exempt from bankruptcy
>   seizure according to a WSJ article.  Is your information more current
>   than that?  Is there a legal opinion somewhere within the sound of this
>   voice?

In a Massachusett's court in 1993 I believe, a friend of mind lost his IRA
in a law suit.  I believe he had a little less than $30000 in it. To add
insult to injury, he had to pay taxes and penalties for taking money out of
the IRA.  I also remember reading an article in the Boston Globe similar to
the WSJ article that you referred to.  I showed it to my friend.  At the
time, the case was still pending before the court.  For whatever reason, he
lost his money anyway.

    
    
    	I wrote a BASIC program that I used to compare taking my
    	lump-sum $$ vs taking a monthly amount for the rest of my
    	life (talking retirement benifits here).  If I can invest
    	my lump-sum and realize > 7.1% return then I come out
    	ahead.  BAsically the program calculated monthly interest
    	(I could enter various rates)  and deducted what Digitial
    	specifies as the monthly payment amount if I go with the
    	monthly amount.  Once I get above 7.1% I ma getting more
    	in interest than I am taking out in the monthly sum.  If
    	I was able to realize 10% average gain(consistent) my
    	lump sum AFTER TAKING OUT DIGITAL's CALCULATED MONTHLY
    	PAYMENT AMOUNT resulted in my having about $900,000 in
    	the bank when I and my wife passed away!  The program
    	also took into account the 50% surviver benefit and
    	I put in expected lenght of life times for my wife
    	and I.
    		I expect others would come up with similar 
    	results.  The other thing I should add is that I called
    	the SAVE office and asked for an estimate based on
    	retiring at age X and taking benifits at age Y.  They
    	sent a nice report laying it all out for me.

    Re: .12
    
    I'm also using BASIC, because I don't trust the BE calcs.  Does
    anyone know how exactly BE does the projections when you ask for an
    estimate of the pension lump sum at retirement?  It is not simple
    annual interest.