AboutJohn D Smith, CFP Expertise I can answer detailed questions regarding mutual fund investing, retirement planning, education planning and related financial planning/investment issues. I have a B.S. degree in Financial Planning & Counseling. I am also a Certified Financial Planner (CFP) and have performed fee only investment management and financial planning services for the past 11 years.
Question As a county employee in Texas I enrolled in a county endorsed (but non participatory)457(b)Deferred Compensation Retirement Plan 6-7 years ago thru an area credit union; and then retired early this year. Only $5-6K in it but with the bond market (they're divided up among Dreyfus, Van Kampen and another) taking a beating, my instinct is to get it out and put it to better use--such as a down payment on a home or rental property. Rumors are spreading now that is an option. Can these instruments be put in other places without the tax beating? They're only losing money now.
Answer There were law changes a few years ago that allowed for some 457 Def Comp plans to be rolled into IRA account once the participant retired. I am not in a position to say whether or not your plan allows this so you will need to check with the plan administrator to see if this is allowed. If so, then there are certain rules that allow for IRA accounts to be invested in direct real estate, however, this is typically a costly maneuver and there are strict rules that need to be followed. The biggest one being any real estate the IRA is invested in cannot be used for personal use. I hope this helps.
