Rollover 401(k) in Madison County, IL

Rollover 401(k) in Madison County, ILProfessional, Honest, and Experienced Retirement Planners and Financial Advisors

Rollover 401(k) in Madison County, IL. Moving to a new job in Madison County, IL is exciting, but it can be hard to know what to do with your existing 401(k). Many Madison County, IL residents don't have the time, financial literacy, or interest to manage multiple retirement accounts or to carefully weigh their best options when considering a 401(k) rollover. At Correct Capital, our dedicated team of 401(k) specialists and retirement consultants will help you get the most out of your savings. For rollover 401(k) services in Madison County, IL, give us a call at 314-930-401K or contact us online.


Rollover 401(k) Options in Madison County, IL

Generally speaking, there are four ways to approach your 401(k) rollover. A qualified Madison County, IL financial advisor like those at Correct Capital will be able to look at your financial situation and guide you towards your preferred option. Depending on your current financial health and your time horizon, we may recommend to:

  1. Leave the money in your former employer's 401(k) plan;
  2. Roll over your 401(k) to a plan with your new employer;
  3. Roll over your 401(k) into a Traditional IRA or Roth IRA;
  4. Cash out 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 savings for tax purposed. 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 50% of the funds.

Another thing to note is that many companies in Madison County, IL require you to move the funds in your 401(k) if your plan has less than $5,000 in it. Additionally, 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 Madison County, IL

Your Madison County, IL 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:


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 original value and market value of company stock in your 401(k) plan. If you won shares of your previous company in your 401(k), you can transfer 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 caps out at 20% for the highest earners — instead of income tax, which may be considerably 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 money. By rolling over to an 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 Range of Investment Options

While some Madison County, IL companies provide 401(k) plans with few limitations on your investment opportunities, most retirement planners find that IRAs offer more control and flexibility than employer-limited 401(k) plans. IRAs typically allow investment in almost any type of asset, including:

  • Shares
  • Bonds
  • Certificates of deposit
  • Mutual funds
  • ETFs
  • Real estate investment trusts
  • Annuities

Combine Your 401(k) Plans

If you change jobs frequently, it could be incredibly helpful to combine the entirety of your retirement funds into one place. That will make it easier to follow how your investments are growing and managing them will be more streamlined. Sustained long-term growth may also be more attainable.


Keep Contributing 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 will be able to supplement your savings.

The financial advisors of Correct Capital will guide you in your decision of what to do during a 401(k) rollover. We have more than 20 years of experience advising both individuals and families and business owners in Madison County, IL with comprehensive 401(k) services. When you meet with us, we'll help you navigate important considerations, for instance which type of savings plan fits best in your portfolio.

Why to Avoid a 401(k) Rollover in Madison County, IL

Depending on how close you are to retirement and other considerations your Madison County, IL retirement planners at Correct Capital may recommend that your savings should be left in a 401(k) account; whether that be your an old plan or rolling them over into a new one. Some reasons to stick with a 401(k) plan over an IRA are:

  • If you like the benefits of your current 401(k) plan. If the fees aren't too high and you're getting strong returns, there may not be a great reason to roll over your 401(k). If the account stops performing or you change your mind for another reason, you can still roll over your 401(k) at any time.
  • Avoid early withdrawal fees if you are 55. While both 401(k)s and IRAs allow for withdrawals when you are 59½, you will not face a 10% early withdrawal fee taking money out of a 401(k) once you have turned 55. So, a 401(k) may be preferable if you would like to retire earlier.
  • Loans from an IRA are not allowed. While typically not advisable, if you are in a situation where you need to take out a loan from your retirement savings, you would only be able to do so if they are in a 401(k) plan.
  • Your employer may match your 401(k) contributions. Employers may contribute a dollar-for-dollar or partial match into a 401(k), while you are the only contributor if you put your savings into an IRA.

Click on the links below to see some of the other services we offer in Madison County, IL:

Rollover 401(k) Madison County, IL | 401(k) Management | Financial Advisors | Retirement Planning Near Madison County

Rollover 401(k) in Madison County, IL | Correct Capital

At Correct Capital, we give all of our clients bespoke guidance and tailor our services and advice to their current financial status, goals, and time horizon. Our team of retirement consultants, portfolio managers, and financial planners have nearly a century of combined experience aiding Madison County, IL individuals and families with 401(k) rollovers as part of our all-inclusive wealth management services. As fiduciary advisors, we are legally and ethically required to act only in your best interested. As an independent firm, we are free to be straightforward and unbiased, and there are no limitations to the services or investment opportunities we can offer you.

Give us a call today at 314-930-401K or contact us online to schedule an appointment with one of our experienced 401(k) experts and retirement consultants today.

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