Rollover 401(k) in Fenton, MO
Professional, Honest, and Experienced Retirement Planners and Financial Advisors
Rollover 401(k) in Fenton, MO. Moving to a new job in Fenton, MO is exciting, but it can also lead to uncertainty about the best way to manage the savings you have in your 401(k) account with your previous employer. Many Fenton, MO residents have found that seeking the help of qualified financial advisors is the best way to manage a 401(k) rollover. At Correct Capital, our dedicated team of 401(k) experts and retirement planners will help you understand your options. For rollover 401(k) consulting in Fenton, MO, give us a call at 314-930-401K or contact us online.
How You Can Approach Your Rollover 401(k) in Fenton, MO
Typically, there are four different things you can do with your 401(k) plan with your old employer. A experienced Fenton, MO financial advisor like those at Correct Capital will analyze your finances and help you determine which option is best for you. Depending on a variety of factors, it may be best to:
- Keep your 401(k) with your old employer;
- 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).
The last option should only be considered if you need funds quickly. Your previous employer will have to take out 20% of the balance in order to pay taxes on it. Depending on how close you are to retirement, the IRS may also take 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 mention that companies in Fenton, MO are allowed to make you move the money if your account has less than $5,000 in it. Additionally, you may be required to cash out your plan if the balance is 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 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 difference between the cost basis and current value of company stock in your retirement account. 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. This way, you may pay long term capital gains tax on your company stock — which caps out at 20% for the highest earners — rather than income tax, which may be considerably more.
The Financial Institution of Your Choice
When you opt to put your savings in a 401(k), you will not have any control over the 401(k) company that holds your savings. When you do a 401(k) rollover to a Traditional or Roth IRA, you'll have your pick of institutions based on how secure they are and the range of services they offer.
A Wider Array of Investment Opportunities
While some Fenton, 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:
- Certificates of deposit
- Mutual funds
- Real estate investment trusts
Combine Your Savings Accounts
If you change jobs frequently, it may make the most sense to merge the funds from all your accounts into one place. That way, you much much more efficiently follow the performance of your funds and you will be able to manage them more directly. Sustained long-term growth may also be more attainable.
Keep Contributing to Your Accounts
While your money will still grow in you old 401(k) plan, you will no longer be able to contribute more savings to it. By rolling over the funds into an IRA, you continue adding more money over time.
The financial advisors of Correct Capital will help you determine if a 401(k) rollover is the best option for you. We have more than two decades of experience advising both individuals and business owners in Fenton, MO with a variety of 401(k) services. When you meet with us, we'll guide you through special considerations, such as whether a traditional or Roth IRA is best for you.
When to Avoid a 401(k) Rollover in Fenton, MO
Every person's finances vary, and your Fenton, MO retirement planners at Correct Capital may recommend that your investments are best kept in a 401(k) plan; whether that be your an old plan or rolling them over into a new one. Some of the advantages of a 401(k) plan over an IRA include:
- 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). 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.
- No 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. A 401(k) may be best if you need or want the money sooner.
- Loans from an IRA are not allowed. While taking a loan from retirement savings should only be considered in certain circumstances, it is important to note that you cannot take a loan out of either a Traditional or Roth IRA.
- Your employer may match your 401(k) contributions. 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 keep contributing to your 401(k) to receive an employer match and keep your retirement assets in one place.
Click on the links below to see some of the other services we offer in Fenton, MO:
- Succession Planning
- Fiduciary Financial Advisor
- Company 401(k) Plans
- ESOP Advisor
- Self-Employed Retirement Plans
- 401(k) For Small Business
- Small Business Retirement Plans
- Tax Planning
- Social Security Consultants Near Me
- Retirement Calculator
Rollover 401(k) in Fenton, MO | Correct Capital
At Correct Capital, we treat each client individually and get to know them so we can help them reach their objectives. Our team of retirement consultants, portfolio managers, and financial planners have over seven decades of combined experience helping 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 imperative to do what's best for you and disclose any potential conflicts of interest. As an independent firm, we will always be straightforward and unbiased, and we are not bound to only offer you limited investment opportunities.