Hello,
I was previously a city employee and was contributing during that time to a pension. However, I decided to change careers. I was not working in that position for long enough to be vested in the pension and they simply return the money to me. I am trying to decide what to do with the money.
According to the paperwork, it is possible to roll this money into any IRA (including a Roth), or a 457b (which I have through that employer, although I am not 100% sure yet whether I will have to move that money at some point. I need to get a hold of someone during "business hours").
Some points:
* it is about $60,000, of which $3,000 is non-taxable (not sure why)
* if I roll it into the Roth, I have to pay taxes on it which will be at a marginal rate of 25% for me
* if I roll into the 457b, no taxes now
* if I collect the money, I pay taxes and an additional 10% early distribution tax (don't want to do this)
It seems like a unique opportunity to me to stack my Roth IRA pretty high and get around the limit. Of course, this will be at the expense of 25% of the money. Decisions, decisions. Any thoughts?