Things are crazy in our world right now, but when have they not been? If we were all to let go and quit reading the paper and watching the news tomorrow, do you think all the bad news would go away? If you refocus your energy on good things, your anxiety over money and the world economy would dissipate. The more we worry and fear, the more we bring to light reasons to worry and fear. It is much like growing old gracefully. We spend so much time resisting it through miracle creams, plastic surgery, and covering everything else we cannot change. Resistance only seems to make fear more prevalent. Fear feeds on fear, and that is exactly what the media is stirring up right now.
The key to life is to enjoy it. Like any relationship, one with a partner or a child, has its ups and downs. Do you withdraw your love from a child during the down times? Well, then why would you withdraw your money from a bank during down times? Where would you put it any way? Especially while CD’s are paying high interest rates right now and are FDIC insured. Not only that, if you were to withdraw your IRA, you would end up loosing more money in penalties and taxes. Do you want to keep bailing out producers of profligacy like politicians and Lehman Brothers Holdings?
What you do need to know is whether the FDIC is insuring your money. Here’s the skinny from www.fdic.gov.
. Checking Accounts (including money market deposit accounts)
. Savings Accounts (including passbook accounts)
. Certificates of Deposit
. Investments in mutual funds (stock, bond or money market mutual funds), whether purchased from a bank, brokerage or dealer
. Annuities (underwritten by insurance companies, but sold at some banks)
. Stocks, bonds, Treasury securities or other investment products, whether purchased through a bank or a broker/dealer
Surely we all face some risk depending on what type of holdings we have. Be smart and do some research. Here is what I have learned from Suzie Orman and other investment gurus this week; leave the mutual funds, stocks and other long-term investments alone. If you have new money to invest, put it in a CD for now, not in the stock market-duhh. Here is a link to an informative article about FDIC insurance. http://finance.yahoo.com/banking-budgeting/article/105756/FDIC-Insurance-Protects,-Except-When
If things are really rough for you and you may need to take drastic measures, although I hope no one ever has to do this, I wanted to impart some additional information. Of course, this is coming from Wikipedia, so I would strongly advise you to consult an attorney before doing anything!
Just in case you have thought about bankruptcy and are worried about loosing your IRA, pension or 401K, I believe that the United States Supreme Court has ruled in one or more cases that a persons IRA is exempt from his or her bankruptcy estate. This may not be the case in all chapters of the Bankruptcy Code, so if this is an option you are exploring, check with an attorney. The case mentioned on Wikipedia was from Chapter 11 of the Bankruptcy Code, and most people file for bankruptcy under Chapters 7 or 13. Keep in mind that bankruptcy laws changed recently which afford more protection for creditors.
As far as protection from creditors many states have laws that prohibit judgments from lawsuits to be satisfied by seizure of IRA assets. I do not know what the laws in Texas protect your investments from Writs of Execution or failure to pay taxes. If there is any protection, those deposits into your IRA should have been made prior to any lawsuit or credit issues.
Last, I would advise you, no matter whether there was a crisis or not, to explore heavily each candidates plan, including those that are running as your U.S. Senator and Representatives. They will greatly affect your future including your ability to pay fewer taxes and afford health insurance. Here is a comparison of the candidates tax plans! http://www.taxfoundation.org/research/show/23165.html
Hold on Tight and God Speed!