Retirement Account Rollovers Liquidate Your Holdings

Ever since I left my job, I’ve been contemplating rolling over my 401k into an IRA (and then perhaps to a Roth IRA, or just leaving it in the IRA) and came to a realization that if you roll over your account, all of your 401k’s holdings will be liquidated. This isn’t a huge revelation, because you can reach it by realizing that your current brokerage will be sending your new brokerage a check, but it’s something I didn’t even really think about when I was researching the process.

This usually isn’t a big deal if you’re invested in mutual funds (and have no psychological attachment to them and their valuations), part of my 401k is locked up in stock positions that are currently in the red (about -4%). So, do I really want to rollover the 401k now or wait until the position improves?

I’m going to let it sit because I have no real pressing need to rollover my assets. The account is still performing well, the funds are up, and I’m happy with the fees and the services in general.

 Personal Finance 

Always Tip With Cash

Whenever possible and convenient, I try to tip with cash. When you tip with a credit card, there is an electronic paper record of the amount you tipped for service. When it comes time to report earnings at the end of the year, all of that tip is counted towards the earnings of that individual. When you tip with cash, there is no such paper trail and it is the individual’s own responsibility to declare how much they’ve earned in tips.

Ask any waiter or waitress about how they treat tips and, if they’re honest, you’ll get one response – they don’t report all their tips. When you’re making a piddly $2 per hour in salary and live off tips, you’ll find that cash “disappears.” (though it would be impossible to prove this) But honestly, these individuals work their butts off for a small payoff and they can would appreciate all the help they can get. So, if you’re the type that tips big because you understand how hard it is to be a server, hook them up by using cash – it’ll invisibly bump your tip percentage up a few points.


500,000 Visitor Contest Reminder

Last Friday, I announced a contest where I’d be giving away five books to one lucky entrant and thus far there have been twenty-two jokes and three links for a combined total of 25 entries. If you’d like to join in on the fun at no cost to you, just leave a comment in the 500,000 visitors contest post and/or link to the contest itself.

By entering today, you have a 4% chance of winning five books… and, if you consider that it costs you nothing to enter, the expected payoff is infinite!

Contest ends this Friday, good luck!

 Banking, Credit 

MBNA + Bank of America = Scheduled Payments Lost

One of the great things about my MBNA Platinum Plus credit card was that I could use it to pay off other credits, basically giving me an additional month of float. Well, when Bank of America acquired MBNA, they consolidated all the cards underneath the BoA brand effective October 23rd. That means any scheduled bill payments you may have had with your MBNA cards disappeared. A reasonable person would have set up the system such that the scheduled payments would transfer over, right? Of course not! That would make it too easy on consumers, think of all the late fees and finance charges BoA just earned other companies. BoA scratches their back and then, sometime in the future, another company can screw you for BoA’s benefit.

So, if you schedule payments that would post after the 23rd, reschedule them again ASAP. Luckily I only had one missed payment, missing by one day (due date today), on a Citi card and they were pretty forgiving about it.

 Business, Credit 

Signing Up For A Discover Business Card

Now that the site generates some income, I have a bona fide “business” and that calls for a business card! My choice right now is the Discover Business card because it offers a 0% Intro APR on purchases for 12 months, which means I can put my MBA classes on it and get 0% for a little while (too bad I just paid for some classes, but there’s always next semester). There, unfortunately, isn’t a 0% balance transfer offer like many other Discover cards but 0% on purchases for 12 months is still a nice perk, especially if you’re just starting a new business.

A few other perks are that I can get 5% cash back on office supplies, 2% on gas (but I’ll be using a Citi Driver’s Edge card for gasoline), and 1% for everything else.

Why would I get a business card when I could just buy stuff with my personal credit card? One reason is that the reporting functionality offered by Discover looks pretty comprehensive and could be valuable come tax time. Secondly, having a “business” credit gives me a little more credence when it comes to tax time because anything that makes you look like you have a business will help. Lastly, getting business credit is difficult and so the earlier I try, the better.

Anyone have any advice about business credit cards or about this Discover card?

 Career, Personal Finance 

10 Best Cities To Find A Job

In my post of five cities where real estate is bubble proof, many of the cities were deemed bubble-proof because they had strong job growth. That particular article was penned by someone in Business 2.0, so when I read an article about the ten best cities to find a job written by the folks at Forbes (hosted by MSN), I wanted to see how the cities matched up.

Well, surprise, none of the top ten cities were on the list of bubble-proof housing markets:

  1. Washington D.C.
  2. Phoenix, AZ
  3. Las Vegas, NV
  4. Orlando, FL
  5. Bethesda, MD
  6. Richmond, VA
  7. Raleigh, NC
  8. Jacksonville, FL
  9. Oklahoma City, OK
  10. Virginia Beach, VA

In fact, Forbes discovered that New York City (5th Bubble Proof), San Francisco (1st Bubble Proof), Los Angeles (2nd Bubble Proof), and Chicago (not on the list) were at the very bottom of the list of best cities to find a job. Part of the reason for their low scoring had to deal with the data they used (the dot-com bust hurt) but it still doesn’t really add up with some of the “reasons” the other article used.

So… either the theory of “limited land” (which has had a couple of well-reasoned holes poked into it by critically thinking readers) is more significant that we thought or Business 2.0 just made things up. Thoughts?

Source: MSN.


Quitters Win, Loyalists Exploited

My friend Miller sent out an email to a bunch of his friends from work (where I used to work) with a revelation he had regarding how long it would take for someone who stayed at a job (a non-quitter) to catch up to someone who left that job (a quitter) for greener pastures. The average raise at my former employer was approximately 4%, which is a pittance compared to the generally accepted historical inflation rate of 3%, and a source of ire amongst many of the young professionals at the company. So, after a recent rash of departures (a count of approximately 50 folks we all personally knew and who joined within the last years), people started playing with numbers to see how long it would take for a non-quitter to reach the same point, salary-wise, as someone who quit. So, what did my friend Miller conclude?

Quitters win because they get salary increases with each move and loyalists are exploited far worse than they recognize, especially when inflation is considered.


2005 Ford Escape Hybrid Added To Tax Credit List

On October 20th, the Internal Revenue Service announced that the 2005 Ford Escape Hybrids were added to the list of vehicles eligible for the hybrid tax credit specified in the Energy Policy Act of 2005. The two vehicles added were the 2005 model year versions of the Ford Escape, previously only the 2006 model years were eligible. The two cars are:

  • Ford Escape 2 WD Hybrid (2005) – $2,600
  • Ford Escape 4 WD Hybrid (2005) – $1,950

For more information on how the tax break works, I wrote about the 2006 Hybrid Tax Break rules back on April 27th.

Here is the full list of eligible vehicles and their tax credit amounts after the jump.
(Click to continue reading…)

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