Rollover 401(k) in Arnold, MO
Rollover 401(k) in Arnold, MO. Starting a new job in Arnold, MO is exciting, but it can also create confusion about the best way to handle the savings you have in your existing 401(k). Many Arnold, MO residents have found that seeking the help of professional financial advisors is the best way to go about handling a 401(k) rollover. At Correct Capital, our dedicated team of 401(k) specialists and retirement planners will help you understand your options. For rollover 401(k) counseling in Arnold, MO, reach out to us today at 877-930-4015 or contact us online.
Rollover 401(k) Options in Arnold, MO
Generally speaking, you have four options when considering whether to roll over your 401(k). A experienced Arnold, MO financial advisor like those at Correct Capital will consider your assets, savings, and 401(k) plan and help you determine which option is best for you. Depending on your specific circumstances, we may advise to:
- Leave the savings in your former employer's 401(k) plan;
- Roll over your 401(k) to a plan with your new employer;
- Roll over your 401(k) into a Traditional IRA or Roth IRA;
- Take the cash value out of your 401(k).
Taking out the cash value should only be considered if you need funds quickly. Your previous employer would be required to withhold 20% of the savings in order to pay taxes on it. Depending on your age, the IRS may also take a 20% early withdrawal penalty, and you would would be subject to federal, state, and local taxes. Meaning, you could lose the majority of your savings.
It is important to note that employers in Arnold, MO are allowed to make you move the money if your account has less than $5,000 in it. Lastly, you may be required to cash out your plan if it has less than $1,000.
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Correct Capital Wealth Management's office is physically located in St. Louis, MO, but we serve clients throughout the United States in both personal financial planning and corporate retirement plans.
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Benefits to Rolling Over a 401(k) into an IRA in Arnold, MO
Your Arnold, MO financial advisors at Correct Capital may counsel that rolling over your 401(k) funds into a Traditional or Roth IRA is your best option. This is beneficial for several different reasons:
Take Advantage of Special Rules if You Have Publicly Traded Company Stock in Your 401(k)
Net unrealized appreciation (NUA) is the increase in value between the cost basis and current value of shares of employer stock in your retirement plan. If you won shares of your previous company in your 401(k), you can transfer that difference into a standard brokerage account, and roll the remainder to an IRA. By separating your 401(k) into two accounts, you may pay long term capital gains tax on the shares — which is 0%, 15%, or 20%, depending on your income — instead of income tax, which may be substantially more.
The Custodian of Your Choice
When you opt to put your retirement funds in a 401(k), the money will be held by the 401(k) company your employer chooses. When you do a 401(k) rollover to a Traditional or Roth IRA, you'll be able to choose your preferred custodian based on how secure they are, the ease of their digital platforms, and the other services they offer.
More Diverse of Investment Options
While some Arnold, MO companies provide 401(k) plans with few limitations on your investment opportunities, IRAs typically offer an individual investor many more options than 401(k) plans. IRAs typically allow investment in almost any type of asset, including:
- Stocks
- Bonds
- Certificates of deposit
- Mutual funds
- Exchange-traded funds
- Real estate investment trusts
- Annuities
Combine Your 401(k) Plans
If you have several 401(k) plans spread across multiple former employers, there are many advantages to incorporating all of your savings into one place. That way, you much much more efficiently track the performance of your funds and managing them will be more streamlined. Sustained long-term growth may also be more attainable.
Keep Contributing to Your Accounts
While you can still reap the benefits of the investments and savings that are already there, you won't be able to add funds to a 401(k) plan with your previous employer. If you roll the funds out of your old employer's plan, you may be eligible to keep contributing to the plan you've picked out.
The financial advisors of Correct Capital will help you understand if rolling over a 401(k) is right for you, and which type of rollover is preferred. We have over 20 years of experience advising both individuals and business owners in Arnold, MO with comprehensive 401(k) services. When you hire Correct Capital, we'll help you navigate special considerations, such as whether a traditional or Roth IRA is best for you.
When Not to Roll Over Your 401(k) into an IRA in Arnold, MO
Depending on your time horizon and other considerations your Arnold, MO retirement planners at Correct Capital may advise that your savings should be left in a 401(k) account; either your previous employer's or your new one. Some of the advantages of a 401(k) plan over an IRA are:
- If your current 401(k) plan works for you. If the fees aren't exorbitant and the return on investment is good, there may not be a good reason to roll over your 401(k). If the account stops performing or you change your mind for another reason, you can still roll over your 401(k) at any time.
- Avoid early withdrawal fees if you are 55. While both 401(k)s and IRAs permit withdrawals when you are 59½, you will not have to pay a 10% early withdrawal fee taking money out of a 401(k) once you have turned 55. So, a 401(k) may be preferable if you would like to retire a few years early.
- Loans from an IRA are not allowed. While typically not recommended, if you are in a situation where you need to take out a loan from your retirement savings, you would only be able to do so if they are in a 401(k) plan.
- Your employer can pay matching contributions into your 401(k) account. While some employers will allow you to roll money out of your 401(k) to an IRA before retirement, it may make more sense to stick with a 401(k) your employer will match your contributions.
Check out some of the other services we offer in Arnold, MO:
- Succession Planning
- Fiduciary Financial Advisor
- Company 401(k) Plans
- ESOP Advisor
- Self-Employed Retirement Plans
Rollover 401(k) in Arnold, MO | Correct Capital
At Correct Capital, we give all of our clients personalized attention and cater our services and advice to their current financial health, goals, and time horizon. Our team of retirement consultants, portfolio managers, and financial planners have over seven decades of combined experience helping Arnold, MO individuals and families with 401(k) rollovers as part of our all-inclusive wealth management services. As fiduciary advisors, we have a legal and ethical imperative to oversee your account in a way that benefits you and only you. As an independent firm, we are free to be honest and unbiased, and we are not bound to only offer you limited investment opportunities.
Reach out to us today at 877-930-4015 or contact us online to schedule an appointment with one of our professional 401(k) specialists and financial advisors today.
