Rollover 401(k) in Lake St. Louis, MO
Professional, Honest, and Experienced Retirement Planners and Financial Advisors
Rollover 401(k) in Lake St. Louis, MO. Moving to a new job in Lake St. Louis, MO can lead to new opportunities, but it can also create confusion about the best way to handle your 401(k) account with your previous employer. Many Lake St. Louis, 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 dedicated team of 401(k) experts and retirement planners will help you determine what makes the most sense for you. For rollover 401(k) advice in Lake St. Louis, MO, call us today at 314-930-401K or contact us online.
Rollover 401(k) Options in Lake St. Louis, MO
Generally speaking, you have four options when considering whether to roll over your 401(k). A professional Lake St. Louis, MO financial advisor like those at Correct Capital will analyze your finances and help you determine which option is best for you. Depending on your current financial health and your time horizon, we may recommend 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 recommended unless you need money now. Your previous employer would be obligated to withhold 20% of the funds for tax purposed. Depending on your age, the IRS may also withhold a 20% early withdrawal penalty, and you would also have to pay federal, state, and local taxes. Meaning, you could potentially lose more than 50% of the funds.
It is important to mention that companies in Lake St. Louis, 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 Lake St. Louis, MO
Your Lake St. Louis, 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 difference between the cost basis and market value of shares of employer stock in your retirement 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 the shares — which is usually 15% but can go up to 20% for people with high-income — instead of income tax, which is often higher.
The Financial Institution of Your Choice
In a 401(k) plan, your employer will decide the 401(k) company holding your funds. By rolling over to an IRA, you'll be able to choose your preferred custodian based on stability, trading technology, and financial services.
More of Investment Options
While some Lake St. Louis, MO companies provide 401(k) plans with few limitations on your investment options, you will generally have much more control over an IRA than you would in a 401(k) plan. 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 multiple 401(k) plans with previous employers, it could be incredibly helpful to merge the entirety of your retirement funds into one place. That way, you much much more efficiently follow how your investments are growing and managing them will be more streamlined. It may also be the better option for long-term growth.
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. 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 guide you in your decision of what to do during a 401(k) rollover. We have over 20 years of experience assisting both individuals and business owners in Lake St. Louis, MO with comprehensive 401(k) services. When you hire Correct Capital, we'll walk you through important considerations, such as whether a traditional or Roth IRA is best for you.
Why to Avoid a 401(k) Rollover in Lake St. Louis, MO
Depending on how close you are to retirement and other considerations your Lake St. Louis, MO retirement planners at Correct Capital may recommend that your funds should be left in a 401(k) plan; whether that be your previous employer's or your new one. Some of the advantages of a 401(k) plan instead of an IRA are:
- If your current 401(k) plan works for you. 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 fees if you are 55. While both 401(k)s and IRAs allow for withdrawals when you are 59½, a 401(k) does not include a 10% early withdrawal fee if you are 55. A 401(k) may be best if you need or want the money sooner.
- You cannot take a loan out of an IRA. While taking a loan from retirement savings should only be considered in certain circumstances, it is important to know 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 stick with a 401(k) your employer will match your contributions.
Click on the links below to see some of the other services we offer in Lake St. Louis, 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 Lake St. Louis, MO | Correct Capital
At Correct Capital, we give all of our clients personalized guidance 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 75 years of combined experience aiding Lake St. Louis, MO individuals and families with 401(k) rollovers in addition to several other wealth management services. As fiduciary advisors, we have a legal and moral obligation to oversee your account in a way that benefits you and only you. As an independent firm, we will always be honest and objective, and there are no restrictions to the services or investment opportunities we can recommend.