Rollover 401(k) in Fenton, MO
Professional, Honest, and Experienced Retirement Planners and Financial Advisors
Rollover 401(k) in Fenton, MO. While moving to a new job can be a welcome change, it can be hard to know what to do with the savings you have in your existing 401(k). Many Fenton, MO residents don't have the time, expertise, or interest to oversee multiple retirement accounts or to carefully weigh their best options when considering a 401(k) rollover. At Correct Capital, our experienced team of 401(k) specialists and retirement consultants will help you understand your options. For rollover 401(k) advice in Fenton, MO, give us a call at 314-930-401K or contact us online.
Rollover 401(k) Options in Fenton, MO
In general, there are four different things you can do with your 401(k) account with your old employer. A qualified Fenton, MO financial advisor like those at Correct Capital will analyze your financial situation and help you decide which option is best for you. Depending on your current financial health and your time horizon, we may advise to:
- Leave the funds 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).
Taking out the cash value is only truly an option if you need funds quickly. Your previous employer would be required to take out 20% of the balance in order to pay taxes on it. You may also face a 10% early withdrawal penalty from the IRS, and you would potentially pay even more in federal, state, and local taxes. Meaning, you could lose the majority of the funds.
It is important to mention that employers in Fenton, 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.
Benefits to Rolling Over a 401(k) into an IRA in Fenton, MO
Your Fenton, MO financial advisors at Correct Capital may advise rolling over your 401(k) into an Individual Retirement Account (IRA). There are a variety of advantages to this strategy:
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 401(k) account. If you won shares of your previous company in your 401(k), you can transfer that increase in value into a standard brokerage account, and roll the remainder to an IRA. In doing so, you may pay long term capital gains tax on the shares — which caps out at 20% for the highest earners — instead of income tax, which is often higher.
The Custodian of Your Choice
When you opt to put your savings 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 have your pick of custodians based on how secure they are and the range of services they offer.
More of Investment Options
While some Fenton, MO businesses provide 401(k) plans with few limitations on your investment opportunities, most retirement planners find that IRAs offer more control and flexibility than employer-limited 401(k) plans. IRAs typically allow investment in almost any type of asset, including:
- Certificates of deposit
- Mutual funds
- Exchange-traded funds
- Real estate investment trusts
Combine Your 401(k) Plans
If you have various 401(k) plans with previous employers, it may make the most sense to incorporate the funds from all your accounts into one account. In doing so, it won't be nearly as much of a hassle to follow 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 will still see return on your investments in you old 401(k) plan, you will no longer be able to contribute more savings to it. If you roll the funds out of your old employer's plan, 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 20 years of experience advising both individuals and families and business owners in Fenton, MO with A-Z 401(k) services. When you meet with us, we'll walk you through special considerations, such as whether a traditional or Roth IRA is best for you.
Why Not to Roll Over Your 401(k) into an IRA in Fenton, MO
Every person's finances vary, and your Fenton, MO retirement planners at Correct Capital may recommend that your investments are better off in a 401(k) plan; either your previous employer's or your new one. Some reasons to stick with a 401(k) plan over an IRA include:
- If you like the benefits of your current 401(k) plan. If the fees aren't exorbitant and your savings are growing as you'd like them to, there may not be a great reason to roll over your 401(k). You are not required to roll over a 401(k) immediately, so you are free to change your mind and transfer the funds at a later date.
- Avoid early withdrawal fees if you are 55. While you can begin taking out funds without a fee from either a 401(k) or IRA at 59½, the threshold in a 401(k) for a 10% early withdrawal fee is 55. So, a 401(k) may be preferable if you would like to retire earlier.
- You cannot take a loan out of an IRA. While taking a loan from retirement savings isn't recommended, it is important to mention that you cannot take a loan out of an IRA.
- Your employer can put matching contributions into your 401(k) plan. Employers may contribute a full or partial match into a 401(k), while you are the only contributor if you put your savings into an IRA.
Take a look at some of the other services we offer in Fenton, 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 Fenton, MO | Correct Capital
At Correct Capital, we give all of our clients bespoke attention and cater our services and advice to their current financial health, objectives, and time horizon. Our team of retirement consultants, portfolio managers, and financial planners have over 75 years of combined experience aiding Fenton, MO individuals and families with 401(k) rollovers in addition to several other wealth management services. As fiduciary advisors, we have a legal and ethical obligation to oversee your account in a way that benefits you and only you. As an independent firm, we are free to be straightforward and unbiased, and there are no restrictions to the services or investment opportunities we can offer you.