Returning to India by mid-end of 2019, need 401k advice
I maxed out 401k as long as I was with Microsoft (they pay 9k to 401k). I recently joined a bay area company. Job's great, they don't contribute to 401k tho, they provide some 401k account with a small financial institution, benefits seem to be none - just hold money pre tax.
I will sell real estate assets and investments in the US when I leave to India. Regarding 401k, I am uncomfortable leaving my money until I'm 60 (under 30 now) in a foreign country that could prevent anyone from entering at any point, but I am open to withdrawing over 1-2 years if there are huge tax benefits of doing so. Considering that I'm moving to India by mid-end 2019:
1. Should I continue to contribute to 401k like I did earlier? (Or just invest post tax money in US equities instead? Done decently okay - indexes seem to be doing great, trading account made 9.8% last 3 months)
2. If yes, do I continue to contribute into the Fidelity 401k account that Microsoft provided? Is that even possible from a different employer? Or do I start a new one with this small institution?
comments
Do you have need for that money when you land in India? If you don’t then no pressing reason to liquidate imo.
Secondly, when you no longer have US income, you will be in lowest income tax bracket that is the best time to withdraw with penalty from 401k. If you do it mid-late 2019 you are looking at higher tax bracket because you have income already that year. You may also withdraw with penalty slowly (spread over multiple years) to ensure you have income which is in lowest bracket each time you withdraw. Obviously depends on how much you have accumulated in 401k.