Rollover 401(k) in Lemay, MO
Professional, Honest, and Experienced Retirement Planners and Financial Advisors
Rollover 401(k) in Lemay, 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 401(k) account with your previous employer. Many Lemay, MO residents have found that enlisting the services of professional financial advisors is the best way to manage a 401(k) rollover. At Correct Capital, our experienced team of 401(k) specialists and financial planners will help you navigate your rollover and optimize your 401(k) account. For rollover 401(k) counseling in Lemay, MO, give us a call at 314-930-401K or contact us online.
Rollover 401(k) Options in Lemay, MO
Typically, there are four different things you can do with your 401(k) account with your old employer. A knowledgeable Lemay, MO financial advisor like those at Correct Capital will analyze your financial situation and help you determine which option is best for you. Depending on your specific circumstances, we may recommend 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;
- Cash out your 401(k).
Cashing out is not recommended unless you need money now. Your previous employer will have to withhold 20% of the funds to prepay the taxes you would owe on it. Depending on how close you are to retirement, 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 your savings.
One last consideration to note is that companies in Lemay, MO are allowed to make you move the money if your plan has less than $5,000 in it. Furthermore, they may be able to cash out your account 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 recommend rolling over your 401(k) into an Individual Retirement Account (IRA). This is beneficial for several different reasons:
Pay Less in Taxes With 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 401(k) 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 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 your company stock — which is usually 15% but can go up to 20% for people with high-income — instead of income tax, which may be significantly more.
Pick Your Own Custodian
When you opt to put your retirement funds in a 401(k), you will not have any control over the 401(k) company that holds your funds. When you do a 401(k) rollover to a Traditional or Roth IRA, you'll be able to choose your preferred custodian based on how secure they are, the ease of their digital platforms, and the other services they offer.
A Wider Array of Investment Opportunities
While some Lemay, MO employers 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:
- Certificates of deposit
- Mutual funds
- Exchange-traded funds
- Real estate investment trusts
Consolidate Your Savings Accounts
If you have several 401(k) plans spread across multiple former employers, it could be incredibly helpful to incorporate all of your savings into one plan. That will make it easier to follow the growth of your funds and managing them will be more streamlined. Sustained long-term growth may also be more attainable.
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 decide if a 401(k) rollover is the best option for you. We have more than 20 years of experience helping both individuals and business owners in Lemay, MO with numerous 401(k) services. When you meet with us, we'll help you navigate special considerations, such as whether a traditional or Roth IRA is best for you.
When to Avoid a 401(k) Rollover in Lemay, MO
Depending on how close you are to retirement and other considerations your Lemay, MO retirement planners at Correct Capital may recommend that your funds are better off in a 401(k) plan; whether that be your an old plan or rolling them over into a new one. Some reasons to choose a 401(k) plan over an IRA include:
- If your current 401(k) plan works for you. If the fees are fair and the return on investment is good, 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.
- Avoid early withdrawal penalties if you are 55. While you can begin taking out money without a fee from both 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 a few years early.
- Loans from an IRA are not allowed. While taking a loan from retirement savings isn't recommended, you would only be able to do so if they are in a 401(k) plan.
- Your employer can pay matching contributions into your 401(k) plan. 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) 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 Lemay, 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 Lemay, MO | Correct Capital
At Correct Capital, we treat each client individually and get to know them so we can help them reach their goals. Our team of retirement consultants, portfolio managers, and financial planners have nearly a century of combined experience helping Lemay, MO individuals and families with 401(k) rollovers in addition to several other wealth management services. As fiduciary advisors, we are legally and ethically obligated to act only in your best interested. As an independent firm, we will always be straightforward and objective, and we are not bound to only offer you limited investment opportunities.