I actually was surprised to get letters from 2 former employers when I turned 55. I had vested with both (7 yrs with each of them) and had modest 401k accts, so I thought that was all there was. We were recovering from a personal bankruptcy so I had never been able to save much in personal contributions. However, both employers purchase annuities for employees that are vested. Now, annuities by definition mean that you are dependent on the life insurance company holding that annuity to stay in business! My FIL, for example, worked for Mead Paper Corp. for decades, and lost his entire pension when Mead was purchased and the insurance company subsequently went bankrupt. So I'm not counting absolutely on them, but it's a nice little "boost" if it comes to me. My husband is a state employee and his pension is pretty safe. The agency agreed, at the last union contract, to start funding the pension obligations at a rate double what they were doing before. This will put them as one of the few public agencies to be on a sound basis, actuarially speaking, for their retired workers. His 401k is with PERS, the largest pension fund in the US. An extremely well managed, influential, and progressive pension fund, it is also one of the very few government funds at any level to completely forbid any financial contributions of any sort being accepted by the treasury managers. If you want to know why that's important, you can see the current issue of Forbes magazine for a very enlightening article on how North Carolina's pension manager pays high fund fees, receives substantial contributions from fund companies, yet produces extremely poor investment results for the state employees.

behaviorK - funny you mention a teacher getting into an annuity as part of her retirement planning. Just last week on Suze Orman, a teacher in CA called about this very thing. She was told the 403b was her only option and the caller didn't feel right about it. Suze told her not to contribute to it. At what age does this annuity mature? In the caller's case, it was at 85 YO, which is ridiculous. You may want to get your GF to suck up the 10% or just leave it and stop contributing to that 403b altogether. In the caller's case, she had not started contributing and Suze advised her not to. If she sucks the 10%, you should help her try to find a bit more aggressive fund in which to replace it and try to earn back some of the funds she lost in the surrender. Depending on her age, she can still invest in ROTH, traditional IRA's and have a nice nestegg. That is what Suze recco'd to the caller - to divert the money she would have allocated to this annuity to much more reasonable retirement savings. Whatever you do, she needs to stop the contributions to the annuity pronto and find another avenue - be it Vanguard or whatever else. I think the episode ran last Saturday, which means it repeats tonight with the new episode. If you have TIVO, record all SUze Orman shows and see if the ep with the specific question aired again. Like you, I"m surprised that the employer has such a crappy retirement plan.

>>In each case, I would have been much better off to invest when everyone was pulling out. Much better off. Absolutely. It's the "sheep", or if you prefer, the "lemmings" mentality that affects way too many people. One good way to counteract that: realize that anytime the media is screaming Financial Disaster, that the old saw will apply yet again - "This too, shall pass." OJ's suggestion is actually quite a good one. It uses dollar-cost averaging which is to your benefit, especially if you have a 10-20 yr timeline before pulling those funds out. One note, BTW - ANY bank can set up electronic funds transfers to your stockbroker, insofar as I know. It's called an ACH form and the only requirement is that it must be done in the same amount, each transaction. The transactions can be weekly, monthly, quarterly or even annually - just as long as they can be set up once and not changed. To change an ACH, one has to resubmit new forms each time, so this is why the transactions need to be "automatic." However, since you are leaning towards the idea of investing in RE, I would strongly urge you to at least maximize your retirement contributions. Yes, you may miss the absolute bottom of the RE market by a few months (since maximizing your retirement contributions may slow down your cash savings plan), but you NEED that diversification. You will be tying up a considerable chunk of net worth in very illiquid RE, which is rather like owning a huge bond allocation. As you have seen, the return on money market funds and even TIPS has dropped considerably. At this point they are hardly keeping their eyebrows above the inflation rate. Use your own psychology against yourself - since you recognize that you are a bigger risk-taker in your retirement accounts, diversify that portfolio with at least an 80% equity spread, across at least five sectors of the market. Maximizing your contributions will allow you a diversified base for your total net worth, which is in the end even more important than just paying off one mortgage (or even two!).

Remember the old saying in the stock market, "Sell in May ...and go away!"?? Good advice again this year, it seems. Though October has brought bad news, on several occasions, over the years, one would have thought that to be an improbable scenario this year, what with a big election in the offing ... but it was true again this year. Anyone game for some financial shenanigans? You should have a five to ten year time horizon for such a project as this, but it could work out in as low as three years. Canadian dollar was at par a few months ago, now about 85 cents U.S. buys a Canadian dollar, as people whose money'd fled the U.S. earlier, returned after the recent govt. support: does "BBB" now stand for "Broke Bankers' Bailout"? A recent survey says Canadian banks are among the solidest of the industrialized world, and much of the Canadian market is based on resource stocks, which have taken a hit lately ... but does anyone think that petroleum stocks are going to stay down for the long term? Other resources, including gold, either. Have certificates for some of your mutual funds that you plan to hold for a long time issued, likely at no fee, or some individual stock certificates, usually at a fee here of $50. or so each. Use your certificates, and CDs (preferable, as their value stays constant) if available, as collateral for a fully-secured loan at your favourite (i.e. low-rate) lender. If your lender is willing to lend up to 50% of the value of the underlying asset, consider borrowing up to possibly $30.00 per $100.00 of equity (which means that if the value of those assets drops by 40% to $60.00, you will still be covered 2:1). When the amount of your loan goes to over 50% of the current value of the underlying asset, the bank comes to ask you for either more collateral (stock, mutual fund certifs., CD, etc.) ... or to pay off some of the loan to restore the 50% loan level, called a "margin call" - and that's today ... tomorrow at the latest. I don't want to get one of them, and never have. If you don't have extra collateral on hand, or cash to pay down some of the loan ... don't crowd the margin level! Such extra assets are more likely to be available to folks nearing retirement, as it's probable that they have various investments, and more of them, available to use as collateral if needed. As in gambling, the gal/guy with the good hand who has surplus assets can keep raising as s/he feels appropriate. Maybe buy some quality U.S. stocks whose price has been beaten down recently, plus some Canadian stocks ... oil and gas, pipeline, minerals, rail, possibly a bank ... and some gold? These are some representative Canadian stocks: I'm not saying that they're the best choice. Suncor (SU.TO) has a substantial position in the tar sands with Syncrude, share price 59, 60, 55 at mid year, 26 in early Oct., now about 25. Putting money into development of more cost-effective ways to pull the oil out of the sand, it pays 0.20, 0.75%. Petrocan (PCA.TO) was 54, 52, 48 at mid year ... 23.70 early Oct., now 25. Pays 0.59 - 2.29%. Nexen (NXY.TO) was 38, 36, 34 ... 14.01 early Oct., now 16.46, 19.14 ... 18.90 last Fri - now 17.95. Pays 0.15 - 0.84%. En Cana (ECA.TO) (one of largest suppliers of natural gas) was 89, 83, 78 ... now 55, 61, 58.15 (Fri) 56.94 (Tue). Pays 1.431 - 2.51%. ________________________ Some companies turned into unit trusts several years ago, agreeing to pay out about 85% of earnings, and avoid tax ... but when some big cos. (e.g. Canada's largest phone co.) planned to do that ... the gov't cut them off at the pass ... said they'd all have to turn into corporations by 2011.(1) Canadian Oil Sands (COS-un.TO) major player with Syncrude in the tar sands, containing more oil than in Saudi ... in 1st qtr. '08 was 32 - 46, in 2nd qtr. was 40 - 54, in 3rd qtr. 38 - 54, as low as intra-day 23 in early Oct., now 26.76. Pays $3.55, 12.6% ... possible revision downward? Pengrowth (PGF-un.TO) was 18.13, 17.93, 17.70 ... 9.62 early Oct., now 12.00 ... annual payout over $2.00 per unit - but don't count on that level being maintained. I own a few units ... thinking of buying more. Enerplus (ERF-un.TO) was 46, 44, 41 ... 25.50 in Oct. ... now 28.28 ... pays about $5 (about 18%) annually per unit - probably also due for adjustment downward, due to oil price drop. Their rep is to speak to an investment group in our city tonight, so I've been doing some checking. __________________________________ Potash (POT.TO) (potash fertilizer, in major ongoing international demand to increase agricultural yields) 213, 223, 211 in summer ... 102 in early Oct., now 95 - 97 ... payout about 0.421, about 0.43%. Check their multi-year chart. Teck Cominco (TCK-B.TO) (base metal miner-processor) I bought at 35 early Jan, was 50 in May, 45, 41 in summer, 16.36 early Oct., 11.28 last Fri (payout 1.00 - about 8.75%), 8.75 Tues. (payout over 10%): I've been thinkig of buying more ... watching it closely. Several of our major mining companies bought out, owned offshore, shares no longer avail. to us ... I figure that this one may be a candidate ... especially at low price per share. That usually causes share price rise of 10 - 25%, even 35% overnight. TD Canada Trust (TD.TO) (one of our 6 national banks) was 63, 58, 58, 60 in summer, 52 early Oct., now 55.86 maintained its value about the best during the U.S. sub-prime problems ... they run a smart ship ... paying about 4%. CN Rail, one of our two major national railroads, recently bought substantial U.S. trackage ... shares not avail. in Canada - cf. CNI on NYSE. Enbridge (ENB.TO) (major pipeline) 44, 44, 43 ... early Oct was 35, now is about 40 (I've owned it about 14 years, turned 75 to upwards of 480 during that period). Pays some over 3%. TransCan. Corp. (TRP.TO) (major pipeline, plus) was 38, 37, 38 ... 31 in Oct, now 35 ... payout about 4%. Check stocks' info at Yahoo-> Finance, near top left enter symbol in small dialogue box, "Get quotes" to get much current info ... or give company name to get symbol. Chart at lower right shows price movement today and clicking on letters under the chart allows viewing charts over several days, months and years. At some below top left, clicking on "Historical prices" allows one to view daily open, high, low and close prices, plus dividend payouts, back several years for some stocks. Also daily volume ... which is often quite a lot higher when stock price near a top or a bottom. When stocks are at bargain prices ... if I can borrow to invest, fully secured, at 4.75%, paying interest only monthy and deductible ... and earn 4% (taxed at very low rate) ... and I gain the value of inflation ... that looks like a worthwhile opportunity. So - prices drop some more, later? If they stay down for a while, I may whimper a bit, as I could have bought later and enjoyed the substantial runup over the next few years ... but suppose the market is near bottom now? Not much use showing up at the station after the train has pulled out! Best to buy on several occasions as one believes the market to be nearing bottom, as it's volatile, then, making several false starts back up. I hope that you're all enjoying fall. I was picking some mature peas and beans yesterday plus radish pods for seed, moving some squash into the barn, lifting some beets ... and my fingers were doing some complaining, as it was a few degrees above freezing. More beets, turnips and carrots to lift today. Broccoli seems to be minimally affected by frosts, still producing (mainly small sized) florets - but that'll soon be through. ole joyful P.S. Want a real gamble? Our major phone co., Bell Canada, covering 2/3 of total Canadian population in Ontario and Quebec, more or less widows' and orphans' stock, wanted to go unit trust, then gov't. changed rules to block them. Then BCE (BCE.TO) made a deal with a major pension plan and buyout artist, backed by billions of loans from several banks, to buy out shareholders at $42.75 and go private ... when stock price in low 30s ... stock price went to about $39., but somewhat below the offering price, and usually price jumps to right up near the offer price. That was just before the U.S. subprime mortgage barnyard byproduct hit the fan, which problem led to this issue's huffing and puffing, lawsuits by current bondholders, etc., and several delays in the time for the deal to be consummated. Stock price continued around 39 - 40 through the end of '07. I'd bought some at about 28 a couple of years ago,and felt that, with the deal to go through in a few months, to buy some more about 38 last Christmas looked like a good idea. Early in this year the stock price began slipping, and the date of completion was postponed ... plus the company decided to suspend paying dividends. Stock was just over 35 at the end of June, recovered to 40s in August, then down again to 33 in early Oct., recovered to about 37 now ... with deal to have been completed in early Nov. ... that's ... of this year. One of the backers is the Royal Bank of Scotland, which recently received an infusion of credits from the Bank of England ... so are they going to be willing/able/allowed to complete a substantial deal ... in the (former) colony ... any time soon? Price closed at 37.90 Tuesday Nov. 11 ... want to take a chance on the deal completing, at the originally agreed price of $42.75, any time soon? o j