Rollover 401(k) in Lemay, MO
Rollover 401(k) in Lemay, MO. Moving to a new job in Lemay, MO is exciting, but it can be hard to know what to do with the savings you have in your 401(k) account with your previous employer. Many Lemay, MO residents have found that seeking the help 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 financial advisors will help you navigate your rollover and optimize your 401(k) account. For rollover 401(k) services in Lemay, MO, reach out to us today at 877-930-4015 or contact us online.
Rollover 401(k) Options in Lemay, MO
Generally speaking, you have four options when considering whether to roll over your 401(k). A professional Lemay, MO financial advisor like those at Correct Capital will be able to look at your assets, savings, and 401(k) plan and guide you towards your preferred option. Depending on your current financial health and your time horizon, we may recommend to:
- Keep your 401(k) with your old employer;
- Roll over your 401(k) to your new employer's 401(k);
- 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 will have to withhold 20% of the balance to prepay the taxes you would owe 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 potentially lose more than half of your savings.
Another thing to note is that many employers in Lemay, MO require you to roll over the funds to an IRA or new 401(k) if your plan has less than $5,000 in it. Furthermore, 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 Lemay, MO
Your Lemay, MO financial advisors at Correct Capital may advise rolling over your 401(k) into an Individual Retirement Account (IRA). There are a variety of benefits 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 original value and current value of shares of employer stock in your retirement account. If you won shares of your previous company in your 401(k), you can put that difference into a standard brokerage account, and roll the remainder to an IRA. By separating your 401(k) into two accounts, you may pay long term capital gains tax on the shares — which is 0%, 15%, or 20%, depending on your income — instead of income tax, which is often higher.
The Custodian of Your Choice
When you opt to put your retirement funds 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, the ease of their digital platforms, and the other services they offer.
More of Investment Options
While some Lemay, MO businesses offer 401(k) plans with few limitations on your investment opportunities, IRAs typically offer an individual investor many more options than 401(k) plans. 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 several 401(k) plans spread across multiple former employers, it could be incredibly helpful to incorporate the funds from all your accounts into one place. That way, you much much more efficiently follow how your savings are growing 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 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 may be eligible to keep contributing to the plan you've picked out.
The financial advisors of Correct Capital will help you understand if rolling over a 401(k) is right for you, and which type of rollover is preferred. We have more than 20 years of experience helping both individuals and families and business owners in Lemay, MO with comprehensive 401(k) services. When you retain our services, we'll help you navigate important considerations, for instance required minimum distribution model makes the most sense for you.
Why to Avoid a 401(k) Rollover in Lemay, MO
Every person's finances vary, and your Lemay, MO retirement planners at Correct Capital may advise that your investments are best kept in a 401(k) account; whether that be your an old plan or rolling them over into a new one. Some reasons to choose a 401(k) plan instead of an IRA are:
- If your current 401(k) plan works for you. If the fees aren't too high and your savings are growing as you'd like them to, it may be advisable to keep your savings where they are. 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 penalties if you are 55. While both 401(k)s and IRAs allow for withdrawals when you are 59½, the threshold in a 401(k) for a 10% early withdrawal fee is 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 isn't advisable, 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. Employers may contribute a full or partial match into a 401(k), while an IRA would only include the money you put into it.
See some of the other services we offer in Lemay, 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
Rollover 401(k) in Lemay, MO | Correct Capital
At Correct Capital, we treat each client individually and get to know them so we can help them realize their objectives. Our team of retirement consultants, portfolio managers, and financial planners have over seven decades of combined experience helping Lemay, MO individuals and families with 401(k) rollovers as part of our comprehensive wealth management services. As fiduciary advisors, we are legally and ethically bound to do what's best for you and disclose any potential conflicts of interest. As an independent firm, we are free to be direct 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 professional 401(k) specialists and financial advisors today.
