Got a anuity with not much in it. Cash it out?

[Mr.P]

I have like 7k in a anuity plan from my old union job. Withrdrawn from the union 99% sure I will not be returning.

Should I try to "liquidate" it. It is tax sheltered so I will owe taxes on the 7k, fees, and a 10% tax additional (I believe)


It is not really gaining much money yearly, and has actually been slowing down on return and the fees are 10$ every "period"

3 year rate of return is like less than 9% so far. :thumbdown

was like 15%.

So get rid of it?

It would be great if I was still doing that job and adding to it. 10% on 100k adds up in 40 years.

 

[Ogier le Danois]

I have like 7k in a anuity plan from my old union job. Withrdrawn from the union 99% sure I will not be returning.

Should I try to "liquidate" it. It is tax sheltered so I will owe taxes on the 7k, fees, and a 10% tax additional (I believe)


It is not really gaining much money yearly, and has actually been slowing down on return and the fees are 10$ every "period"

3 year rate of return is like less than 9% so far. :thumbdown

was like 15%.

So get rid of it?

It would be great if I was still doing that job and adding to it. 10% on 100k adds up in 40 years.

Perhaps you can roll it over into an IRA or Roth IRA?

I wouldn't cash out and take penalties if it is possible to avoid it.

 

[afm199]

3% is much more than you will get in a CD. Add in the penalty and you get hosed. Keep it and let grow.

 

[F4iChic]

Not worth cashing it in after you pay taxes, fees, penalties or whatever

Just leave it be, unless you are hard up for the $3k you might get after all the above

 

[Mr.P]

I am not much on investment....Honestly I keep track of this thing like a illegitimate child. I think if I cashed it out and invested it into something that is more manageable? I have apprehension about having someone else "control" where the money is invested. Am I crazy?

 

[Mr.P]

3k? Is it that bad?

I was figuring I could pull 5-6k after all the crap. Again I am a anuity noob.

 

[mean dad]

Small world. My old union contacted me about an annuity I have, with a right around the same amount.
I've been unsure of what to do with it, as my inherently suspicious side doesn't think they'll have my money in X number of years. Bird in the hand and all that.
Subscribed.

 

[wazzuFreddo]

Figure at least half of it is gone in taxes and penalties.

Roll it over into an IRA, that way you won't take the hit of a cash out. Put it in a no load fund to your likeing, that way you won't pay a ton of fees either.

 

[F4iChic]

Lets just say I had a friend who cashed in approx $56k, out of necessity

$20k straight to taxes. Paid immediately. No waiting to add this to your tax return next year, have to file some estimated thing or other.

Ok so $3k was a little low, maybe 4k :dunno

 

[wazzuFreddo]

A former employer offered a pension buyout, but the sum was laughable. I managed to save at least 5x the amount in my 401k during the same time period.

They aren't getting that liablity of their books so cheap :x

 

[Ogier le Danois]

I am not much on investment....Honestly I keep track of this thing like a illegitimate child. I think if I cashed it out and invested it into something that is more manageable? I have apprehension about having someone else "control" where the money is invested. Am I crazy?

Again, please, please, please see if you can roll it over into an IRA of some kind.

You will then be able to control it by choosing stocks, etfs, Mutual funds and the like.

 

[afm199]

There nothing wrong with annuities. If you leave it there for ten years it will probably be worth $10k, or more if rates go up. If you invest it in the stock market it might be worth more, it might be worth less. One of the better investments I ever made was an annuity. Find out what the actual terms are. Is it fixed, variable, stock indexed, interest indexed, etc.. If you pull it you pay tax on all the interest paid since it was started, and on the principal if it was not qualified. Plus a penalty.

 

[Mr.P]

If they ever answer the F_IGN phone! Goes straight to on hold in this horrible loop.


I will get the straight answer from them.

Rough calculations show I should get approximately 6k it is 7,910$. 10% for penalty..What are the tax consequences?

 

[redruM]

if you own no tangible assets - specifically gold or silver - this might be a good time to diversify a little.

or, just do what everyone else and their mother does and store it away in an insolvent bank.

 

[SpeedyCorky]

I have an anuity, but i need cash nooooww....... CALL J-G WENTWORTH!

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love that commericial.........

 

[wazzuFreddo]

If they ever answer the F_IGN phone! Goes straight to on hold in this horrible loop.


I will get the straight answer from them.

Rough calculations show I should get approximately 6k it is 7,910$. 10% for penalty

Don't forget taxes (rough estimates)

Fed
$6,000 * 35% = $2100

State
$6,000 * 6% = $360

$6,000 - $2,100 - $360 = $3540

Like we said, don't expect more than $3k or so.

 

[Cycle61]

Small world +2

Have an annuity that was a UAW defined benefit plan at NUMMI, it went to something, sat in limbo for a couple years, and now got rolled over to Prudential. Amount is roughly the same, in the vicinity of $7k. I'm trying to consolidate investments, so I should be able to roll it into an IRA without much consequence, right?

 

[Mr.P]

^Yep.

There are no penalties with the anuity itself as I have not worked 300hrs in 2 consecutive calendar years.

Tax penalties only. 35%?!?!? What the shit!

Maybe not worth it after all.

It is actually more like 8,019.07$

 

[wazzuFreddo]

35% or what ever your income braket is.

Like your regular paycheck, the fed has to get its slice since you are talking about pre-tax retirement money.

 

[Mr.P]

The penalty does not apply to your original annuity investment. But if you have not started receiving payments from your annuity, withdrawal rules specify that your earnings are withdrawn first, then your original investment.

You may be able to avoid the 10% penalty if you meet one of several exceptions:
• You begin to receive regular payments that will last for the rest of your life
• You have substantial un-reimbursed medical expenses
• You are withdrawing annuity funds as part of a divorce settlement, personal injury settlement, or similar legal ruling
• You are disabled