Is annuity a good rollover plan for 401(k)?

My husband was recently laid off and he has $229,000 in a 401(k). He has been told that he should roll it into a hybrid annuity. Is this a good idea?

Absolutely not! It sounds to me like he’s been talking to an insurance agent instead of an investment adviser. There’s no reason to put a 401(k) into an annuity. Annuities are there to protect money, as it grows, from taxes. Well, guess what? The 401(k) already is protecting it from taxes.

I would roll it into a traditional IRA in a series of growth stock mutual funds. You’ll have half the fees, the adviser won’t make anywhere near the commission he’d make on an annuity, and you’ll get much better results in the end.

Yeah, I definitely wouldn’t go the annuity route. I don’t have a single annuity, and I’ve got a lot of investments. One of the reasons so many “advisers” push annuities is because they wind up with bigger commissions. Annuities aren’t evil or anything, but they’re definitely not the proper product for you in this situation.

Get away from the guy who gave you this advice and find a good financial adviser — not an insurance guy — with the heart of a teacher. You need to talk to someone who’s interested in helping you two plan for your future, not theirs.

I’m 37 years old, married with two great kids and I was just diagnosed with multiple sclerosis. I’m trying to plan for the future and I was wondering if you have any suggestions for work-at-home or selfemployment ideas for people with disabilities.

I’m really sorry to hear you’re facing this. You’re a smart, brave young woman to be looking ahead and making plans for the coming years.

I suggest you read a book by Dan Miller called “48 Days to Creative Income.” Dan is a friend of mine, and he also wrote a popular book titled “48 Days to the Work You Love.” The issue you’re talking about is very close to his heart, and I think his books will be a great help to you.

There’s also a book by Richard Bolles. It’s called “Job Hunting for the So-Called Handicapped or People Who Have Disabilities,” and it’s full of ideas to help you work around the issues you’ll be facing.

There are lots of people out there — well-known, highly successful folks — who have disabilities and still make good money and have rewarding lives using the principles found in these books. Another great piece of news is it sounds like you have a wonderful support system around you.

God bless you all, Chris. I’m praying for you.