I’m 70 years old and don’t want to loose any more in the . My financial adviser seems to want to sell me what is profitable to him rather than what is best for me. He won’t tell me if I can withdraw the for CD . A little knowledge will help me plead my case to him.

 

  • Ted 6:43 pm on August 31, 2010

    You are being ripped off. I don’t understand what you mean by "pleading" your case. You are the customer. You give orders and the broker obeys. Get rid of this person immediately.

    An IRA is not and investment; it is a form of ownership.

    It is possible that your so-called financial adviser is a mutual fund salesman and can’t sell CDs. Go to a full service broker like Smith Barney and tell them your situation. They will open and IRA for you and assist you in transferring your assets from the other place. They can then put your funds in anything you want, including CDs. Do this today. It sound like you are dealing with a crook. Feel free to email me if you have trouble finding someone.

  • SmartA$$ 6:43 pm on August 31, 2010

    Yes, within the blanket of your IRA, you can choose any investment type including plain old bank CD’s.

    If your broker is trying to sell you what profits him, I suggest you find a new broker. Find someone who has the heart of a teacher who will help inform you so that you can make decisions, rather than trying to sell you on something that profits him. You can always roll your entire IRA into one managed by a different broker with no tax implications of any kind.

  • BitHitter 6:43 pm on August 31, 2010

    Yes. You can "transfer" your funds from IRA vehicle to vehicle; however, in order to avoid penalties – you should initiate the transfer with another broker or banker.

    The transfer process is very easy and you never physically touch the money; therefore, you are not in danger of getting penalized by the IRS.

    There are other ways; however, a transfer is by far the easiest.

    Also, note that this does not include any fees charged by your current broker for selling the securities. These fees are likely to be nominal.

  • Luigi 6:43 pm on August 31, 2010

    That depends on what you consider a penalty. You will have to pay taxes on the funds withdrawn, but there is no 10% underage penalty, because you are over 59½. Further, if you own mutual funds with redemption fees, then you’ll be charged for those fees, which could be several percent.

    Unless you need the money for living expenses I would leave it were it is (but don’t buy any more). You may also want to consider moving your IRA to a company/broker that shows more concern for your interests rather than his. Just my opinion.

  • Steve D 6:43 pm on August 31, 2010

    My first suggestion would be to call your advisor and ask him how he gets paid – commission or fee-based. If he says commission, then you are pretty much spot on about his motives. My suggestion would be, first, start calling around for a new financial advisor that is fee-based. Although this will cost you money out-of-pocket, fee-based advisors are not motivated by the profit involved in selling you stuff, since there is no difference in what they earn.

    Once you have switched, sit down for an hour or two with your new advisor and go over all of your current investments, assets, debts, etc. A good advisor will also try to get a feel for how risk-averse you are and place you in investments that are more suitable.

    Now, to the original question – at your age, you can start to withdraw money from your IRA (and by law, you may need to). There are certain rules as to withdrawal and if you break these rules, there are penalties. Your advisor or accountant will know the rules. Money you withdraw can be spent any way you want, including re-investing it.

    Another option might be to look at what investment options your advisor has and just move the money from the stock market to a money market, CD, bond fund or something more conservative. You don’t mention how your funds are invested, but most advisors will suggest that you leave at least some portion of your fund in the stock market, which enables you to profit from any jump in prices.

    One suggestion I might make would be to educate yourself on the various investment options your advisor can offer so that you can rebut any arguments he might make. The SEC has a good investors’ education page as does the Federal Reserve Board. You can also try the following web site for much more info on a variety of financial education subjects:
    http://www.choosetosave.org/

  • src50 6:43 pm on August 31, 2010

    Yes, you can withdraw from your IRAs. But if they are conventional IRAs, those withdrawals are taxable income. If you don’t need the money right now, just TRANSFER the IRAs to a new custodian that offers IRAs with CDs, like a bank.

    Don’t be intimidated by a financial advisor – it’s YOUR money, not his.

  • MoneyMann 6:43 pm on August 31, 2010

    Sure, you can take the money out, pay taxes on it, if any, and spend it, give it away, buy CDs at your local bank, or a little of all of those things.

    If you want to own CDs within your IRA, you can complete the forms at a local bank to effect the direct transfer of assets from your current IRA to your new IRA at the bank. Then, you could put it in a CD there. Or, you could liquidate your IRA and roll it over within 60 days to your new IRA at a bank and buy CDs.

    MAKE SURE there are no redemption charges on the mutual funds you plan to sell!!!

    Finally, if your broker at your current IRA offers CDs, you can get them there. Brokered CDs, however, are a lot different than bank CDs, so make sure the broker explains them to you.

    Hope that helps.

    Disclaimer. The information in this response is for general purposes only, and shall not be construed as specific tax, legal, or investment advice for any individual. The questioner is urged to contact their own professional advisors before implementing any tax or investment strategy.

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