To Top
Login to DV Client Portal
Login to Schwab Alliance
Send secure files to Art Dinkin
Send secure files to Ihla Oertwig

Fiduciary

We provide the highest level of care and accountability. Everything we do must be in your best interest.

Complete Transparency

No magic tricks or distractions. Everything we do is transparent. Log into our online system to see your accounts any time, from any device, no matter where you may be.

Experienced

We have been serving client needs for over 30 years which means we probably have experience in situations like yours.

Local & Available

We are not a large institution. We are your neighbors who happen to offer financial expertise. When you call, we answer. When you need someone, we are here.

Different People. Unique Needs

Some people need help accumulating and growing wealth. Others need assistance with the responsibilities wealth creates. No matter your money issues, we will help you find the solutions which best fit

Retire Confident

Retirement is a once-in-a-lifetime experience, but we have helped people retire comfortably and confidently for over 30 years. We can help you too.

Get Comfortable

We provide a safe and relaxed environment where you can be comfortable with your money.

The media provides exposure, not advice

In this age of information overload, there are an over-whelming number of financial opinions. We help you focus on your specific financial goals by using our experience and knowledge as a filter to cut through the constant noise and chatter.

You are not your neighbor

There is no magic formula that works for everyone. We have the knowledge, experience and tools to help you plan and achieve your goals.

Wealth is not determined by money

Wealth is determined by love, happiness, and relationships. The number of dollars in your account does not make you more or less than anyone else.

It is a journey,
not a destination

No matter what your stage of life and career, we can help you. As you change and grow, we adjust so your plan continues to fit your needs.

Putting it all together

All the parts of your life are connected. Getting to know you goes beyond your finances. We want to know your values, hopes, and dreams so your success is not purely financial. A life measured only in dollars can never be rich. 

Independence brings freedom

Our “product” is our guidance and advice, not specific investments. We are neutral and transparent when selecting the solutions necessary to implement your plan.

Simplicity

It is our job to explain your money in simple and straight-forward terms, not to impress you with jargon and investment “speak”. You can never ask too many questions. 

Investing, not trading

It is not flashy, but the long term outlook has stood the test of time. We seek to capitalize on this trend through patience and discipline rather than guessing when to zig and when to zag.

It takes two to tango

We provide the know-how; you provide direction and guidance. 

Blog Posts
Back
Back
 
5
Jun 2012
By Art Dinkin

Comparison of 401(k) and IRA

When I teach Personal Finance at DMACC, I love to ask the students "other than contribution limits, what is are differences between an IRA and a 401(k)?"

The similarities are plentiful. Both come in before tax and after tax (Roth) versions and both offer tax deferred growth. The easy difference is the contribution limits. In 2012, you can contribute $17,000 to a 401(k) ($22,500 if you are age 50 or older) versus a maximum contribution of $5000 ($6000 if you are age 50 or older) to an IRA. But there are two primary differences many retirement investors overlook; one is an advantage and the other is a disadvantage.

The advantage of a 401(k) is free money from the employer. 401(k)'s are a form of defined contribution profit sharing plan. Employers offer incentives for employees to participate because the highly compensated employees (that is generally the owners and executives of the company) may be limited in their own involvement unless enough "rank and file" employees participate. It is not unusual to see a matching incentive where the company adds to an employee's contribution. For example suppose the employer offers a match of 50% of the first 6% contributed. If the employee makes $100,000 per year and contributes $6000 to the 401(k), the employer will add an additional $3000 to their contribution. Who wouldn't be happy with a 50% "return" on their investment in the first year? The employer's money may be subject to vesting requirements, but in most situations employees are fully vested after 6 years of eligibility. Once an employee has received the employer's money and has become fully vested, there is no additional advantage to the 401(k) over an IRA.

The advantage of an IRA is an issue of control. Most retirement plan participants do not realize that they do not own their accounts. Retirement plan assets are owned by a trust, for the benefit of the employee. The trustee, who is often also the employer, has a fiduciary responsibility to act on behalf of the employee in the employee's best interest. Precedence has been established that this responsibility includes offering a reasonable selection of investments but limits the participants to only those investments offered inside the 401(k) plan. On the other hand, IRA's are owned and controlled by an individual who is free to invest in any investment which can legally be held in an IRA. Furthermore, since only the account owner can authorize a distribution, it is sometimes a lengthy process to get money out a 401(k).

So once the free money is fully vested, there is no good reason to maintain a 401(k) over an IRA. I generally recommend a tax free direct transfer from a 401(k) to an IRA whenever someone changes employment or is eligible for an in-service distribution. By doing that, they are better able to control their investment and the timing of their withdrawals.

Photo retirement by 401k

Recent Posts