I am writing on behalf of my wife. This is a weird one. Before she met, her credit union talked her into taking a large chunk of her savings, opening up a Roth IRA with the bank, and then as the investment vehicle, using two traditional bank CDs which obviously are performing well less than the stock market in general.
We want/need to get that money out and into her work's 401k retirement savings plan. We're okay with taking a $100 or $200 hit on early CD withdraw to get that money earning at a higher rate NOW.
We stopped in at the bank, and wanted to see what the penalty for closing the CDs, moving the money to savings, and then drastically ramping up my wife's 401k contributions as a way of moving the money from CDs to 401k. But the bank made it clear that doing this would result in federal penalties for closing the IRA before retirement.
We kinda agree that we'd wait until September in the one week renewal window of the CDs to roll them over to her 401k which would not result in federal early IRA withdraw penalties.
But, what I realize now is that the bank lady put up a smoke screen to keep that money at that bank (credit union) longer than we need.
My real question:
Can we just initiate a rollover from her IRA that has CD holdings, to get that money less CD closure feeds to her 457 NOW?
This would, I assume, result in the CD early closure penalty which we are okay with, and hopefully avoid the 10% or whatever federal penalty for closing the IRA.
Does that plan of attack make sense?
Submitted January 14, 2019 at 08:28AM by EggdropBotnet http://bit.ly/2H9GyQo
