Rollover 401(k) in Arnold, MO
Professional, Honest, and Experienced Retirement Planners and Financial Advisors
Rollover 401(k) in Arnold, MO. Moving to a new job in Arnold, MO can lead to new opportunities, but it can also create uncertainty about the best way to handle your 401(k) account with your previous employer. Many Arnold, MO residents don't have the time, knowledge, or interest to manage multiple retirement accounts or to understand the best way to approach a 401(k) rollover. At Correct Capital, our experienced team of 401(k) specialists and financial planners will help you get the most out of your savings. For rollover 401(k) counseling in Arnold, MO, reach out to us today at 314-930-401K or contact us online.
Rollover 401(k) Options in Arnold, MO
In general, there are four different things you can do with your 401(k) plan with your old employer. A experienced Arnold, MO financial advisor like those at Correct Capital will analyze your finances and help you decide which option is best for you. Depending on a variety of factors, we may recommend to:
- Leave the money 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;
- Cash out your 401(k).
Cashing out should only be considered if you need funds quickly. Your previous employer will have to withhold 20% of the funds to prepay the taxes you would owe on it. Depending on how close you are to retirement, the IRS may also withhold a 20% early withdrawal penalty, and you would potentially pay even more in federal, state, and local taxes. Meaning, you could lose the majority of the account's value.
It is important to note that many companies in Arnold, MO obligate you to roll over the funds to an IRA or new 401(k) if your account has less than $5,000 in it. Additionally, they may be able to cash out your account if the balance is less than $1,000.
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 original value and current value of shares of employer stock in your 401(k) plan. If part of your 401(k) includes company stock, you can put that portion of your account into a standard brokerage account, and roll the rest of your 401(k) savings to an IRA. By separating your 401(k) into two accounts, you may pay long term capital gains tax on your company stock — which caps out at 20% for the highest earners — instead of income tax, which may be substantially more.
Pick Your Own Financial Institution
In a 401(k) plan, your employer will decide the 401(k) company holding your funds. When you do a 401(k) rollover to a Traditional or Roth IRA, you'll be able to choose your preferred institution based on how secure they are and the range of services they offer.
A Wider Array of Investment Options
While some Arnold, MO companies offer 401(k) plans that include a wide range of investment options, you will generally have much more flexibility in an IRA than you would in a 401(k) plan. In an IRA, you can invest in any number of assets, including:
- Certificates of deposit
- Mutual funds
- Real estate investment trusts
Consolidate Your 401(k) Plans
If you have various 401(k) plans with previous employers, it could be incredibly helpful to incorporate all of your savings into one place. In doing so, it won't be nearly as much of a hassle to follow how your savings are growing and managing them will be more streamlined. Sustained long-term growth may also be more attainable.
Continue Adding Money 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. By rolling over the funds into an IRA, you will be able to supplement your savings.
The financial advisors of Correct Capital will guide you in your decision of what to do during a 401(k) rollover. We have over two decades of experience assisting both individuals and business owners in Arnold, MO with A-Z 401(k) services. When you hire Correct Capital, we'll guide you through special considerations, such as what type of account makes the most sense for your time horizon.
Why to Avoid a 401(k) Rollover in Arnold, MO
Each of our client's financial situation is unique, and your Arnold, MO retirement planners at Correct Capital may advise that your investments are best kept in a 401(k) account; whether that be your previous employer's or your new one. Some reasons to stick with a 401(k) plan instead of an IRA include:
- If your current 401(k) plan works for you. If the fees are reasonable and you're getting strong returns, it may be your best option to keep your savings where they are. If the account stops performing or you change your mind for a different reason, you retain the right to roll over the funds whenever you'd like.
- No early withdrawal penalties if you are 55. While both 401(k)s and IRAs allow for 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. A 401(k) may be best if you're considering early retirement.
- 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 may match your 401(k) contributions. Employers may contribute a full or partial match into a 401(k), while an IRA would only include the money you put into it.
Check out some of the other services we offer in Arnold, MO:
- Wealth Management
- 401k Companies
- Financial Advisor
- Asset Management
- Retirement Consultant
- Financial Portfolio Management
- 401(k) Rollover
- Financial Advice
- Retirement Planning Services
Rollover 401(k) in Arnold, MO | Correct Capital
At Correct Capital, we give all of our clients personalized guidance and cater our services and advice to their current financial status, goals, and time horizon. Our team of retirement consultants, portfolio managers, and financial planners have nearly a century of combined experience assisting Arnold, MO individuals and families with 401(k) rollovers in addition to several other wealth management services. As fiduciary advisors, we are legally and ethically required to act only in your best interested. As an independent firm, we will always be direct and unbiased, and there are no limitations to the services or investment opportunities we can recommend.