401(k) Rollovers

Rolling over your 401(k) may enable you to gain maximum control over your retirement funds.

If you have a 401(k) retirement savings plan, you have accumulated tax deferred-savings for retirement. However, 401(k) plans are often limited to a preset array of investment vehicles. For more investment freedom, or to sever your dependency on an old employer, you may roll over your 401(k) into an IRA or a Roth IRA with your investment advisor. The extra degree of freedom from rolling over your 401(k) may help enable you to gain maximum control over your retirement funds.

Transferring Your 401(k) Plan

Chances are, you’ll change jobs several times over the course of your career. Fortunately, 401(k) plans are portable. If you switch jobs before retirement, you usually can choose among several things to do with your 401(k):

• Leave the money in your former employer’s plan;

• Roll over the money into your new employer’s plan, if the plan accepts transfers;

• Roll over the money into an individual retirement account (IRA); or

• Take the cash value of your account.

With the first three alternatives, you won’t lose the contributions you’ve made, your employer’s contributions if you’re vested, or earnings you’ve accumulated in your old 401(k). And, your money will maintain its tax-deferred status until you withdraw it. You do have some time to consider your options and complete transactions. By law, you must have at least 30 days to decide what to do with your 401(k) when you switch jobs.

Rolling Over Your 401(k) Plan

There are many options to choose from when thinking about how to invest your 401(k) savings. You should consider your overall retirement strategy, how you will maintain tax efficiency, how best to grow and protect your assets, and what type of investment products will best meet your needs in the future. Depending on your goals, you may want to consider an IRA product that enables you to invest in annuities, bonds, mutual funds, money market accounts, or something else. There are rollover options that combine features of these products such as retirement packages with insurance guarantees, periodic drawdowns, etc.

*Guarantees are contingent on the claims paying ability of the issuing insurance company.

Rollovers are not suitable for everyone. Please consider all options prior to making a decision.

Thinking about a 401(k) rollover? Schedule a complimentary consultation to review your financial goals and discuss retirement strategies including rolling over your 401(k).