Well, with the upcoming layoff about to happen next Friday, I will be losing my 401k account through Fidelity. I called Vanguard today and got the process going. This is a tough move for me, as the minimum investment is $1,000 and my 401k balance is only $400 (after 4 short months). That means I have to dedicate $600 of my savings into this account, while simultaneously losing my job and beginning unemployment.
However, I know that A) Unemployment benefits will cover ALL monthly expenses, and B) I will have a job within 4 weeks of my last day at Deere. Even if it’s a minumum wage job, at 40 hours per week I will still hit even. Unemployment will actually pay me more, similar to a $10/hour wage at 40 hours per week. I’ve got enough cash saved that I feel comfortable, even if a bit uneasy, about this decision. It has been too long, and at 23 years old, the longer I wait, the more compound interest I will be missing out on.
I will be rolling over the 401k a couple weeks after my layoff, so Fidelity has time to get their stuff together and sent to Vanguard. I am in their most aggressive, and lowest-entry ($1000) fund they have, which is the 2060 target date fund. It is 90% stocks and 10% bonds, with a 1 year return of over 12%. Once I get re-settled with a job, I will contribute around $100 or more per month to my new start to financial freedom!
Here’s to a bit of risk, and a lot of reward. *Cheers*