Rollover 401(k) in Ladue, MO
Rollover 401(k) in Ladue, MO. Moving to a new job in Ladue, MO can lead to new opportunities, but it can be hard to know what to do with your existing 401(k). Many Ladue, MO residents have found that enlisting the services of qualified financial advisors is the best way to go about handling a 401(k) rollover. At Correct Capital, our experienced team of 401(k) experts and retirement consultants will help you navigate your rollover and optimize your 401(k) account. For rollover 401(k) counseling in Ladue, MO, give us a call at 877-930-4015 or contact us online.
What You Can Do With Your Rollover 401(k) in Ladue, MO
In general, there are four ways to approach your 401(k) rollover. A professional Ladue, MO financial advisor like those at Correct Capital will be able to look at your financial situation and guide you towards what will work best for you. Depending on your current financial health and your time horizon, we may advise to:
- Leave the money in your former employer's 401(k) plan;
- Roll over your 401(k) to your new employer's 401(k);
- Roll over your 401(k) into a Traditional IRA or Roth IRA;
- Take the cash value out of your 401(k).
The last option is not advisable unless you need money now. Your previous employer will have to take out 20% of the funds to prepay the taxes you would owe on it. Depending on your age, the IRS may also take a 20% early withdrawal penalty, and you would also have to pay federal, state, and local taxes. Meaning, you could lose the majority of the funds.
Another thing to mention is that many businesses in Ladue, MO obligate you to move the funds in your 401(k) if your plan has less than $5,000 in it. Furthermore, they may be able to cash out your account if it has less than $1,000.
Benefits to Rolling Over a 401(k) into an IRA in Ladue, MO
Your Ladue, 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. There are a variety of advantages to this strategy:
Pay Less in Taxes With 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 part of your 401(k) includes company stock, you can put that increase in value into a standard brokerage account, and roll the other funds to an IRA. This way, you may pay long term capital gains tax on your company stock — which is usually 15% but can go up to 20% for people with high-income — rather than income tax, which may be considerably more.
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 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 Ladue, MO employers provide 401(k) plans with few limitations on your investment opportunities, 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:
- Stocks
- Bonds
- Certificates of deposit
- Mutual funds
- ETFs
- Real estate investment trusts
- Annuities
Consolidate Your 401(k) Plans
If you have various 401(k) plans with previous employers, 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 how your investments are growing and managing them will be more streamlined. You could also see greater long-term gains.
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 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 20 years of experience advising both individuals and business owners in Ladue, MO with a variety of 401(k) services. When you hire Correct Capital, we'll help you navigate important considerations, such as required minimum distribution model makes the most sense for you.
When to Avoid a 401(k) Rollover in Ladue, MO
Depending on how close you are to retirement and other factors your Ladue, MO retirement planners at Correct Capital may recommend that your funds are best kept in a 401(k) account; either your previous employer's or your new one. Some reasons to choose a 401(k) plan over an IRA are:
- If you like the benefits of your current 401(k) plan. If the fees are fair 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.
- Avoid 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.
- You cannot take a loan out of an IRA. While taking a loan from retirement savings isn't recommended, it is important to know that you cannot take a loan out of an 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 while you are still working, it may make more sense to keep contributing to your 401(k) your employer will match your contributions.
See some of the other services we offer in Ladue, MO:
- Succession Planning
- Fiduciary Financial Advisor
- Company 401(k) Plans
- ESOP Advisor
- Self-Employed Retirement Plans
- 401(k) For Small Business
Rollover 401(k) in Ladue, MO | Correct Capital
At Correct Capital, we give all of our clients bespoke attention and tailor 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 75 years of combined experience aiding Ladue, 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 oversee your account in a way that benefits you and only you. As an independent firm, we will always be honest and unbiased, and we are not bound to only offer you limited investment options.
Reach out to us today at 877-930-4015 or contact us online to schedule an appointment with one of our experienced 401(k) specialists and financial planners today.
