Rollover 401(k) in Millstadt, IL

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

Rollover 401(k) in Millstadt, IL. While moving to a new job can be a welcome new opportunity, it can also create confusion about the best way to handle the savings you have in your existing 401(k). Many Millstadt, IL residents don't have the time, expertise, or interest to manage multiple retirement accounts or to understand the best way to approach a 401(k) rollover. At Correct Capital, our dedicated team of 401(k) experts and retirement consultants will help you understand your options. For rollover 401(k) consulting in Millstadt, IL, give us a call at 314-930-401K or contact us online.


Rollover 401(k) Options in Millstadt, IL

Generally speaking, you have four options when considering whether to roll over your 401(k). A knowledgeable Millstadt, IL financial advisor like those at Correct Capital will be able to look at your finances and guide you towards what will work best for you. Depending on your specific circumstances, we may recommend to:

  1. Keep your 401(k) with your old employer;
  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. Take the cash value out of your 401(k).

Taking out the cash value is not advisable unless you need money now. Your previous employer will have to take out 20% of the funds in order to pay taxes on it. Depending on your age, the IRS may also take a 20% early withdrawal penalty, and you would would be subject to federal, state, and local taxes. Meaning, you could potentially lose more than half of your savings.

One last consideration to mention is that many employers in Millstadt, IL require 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 Millstadt, IL

Your Millstadt, 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. 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 original value 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 portion of your account into a standard brokerage account, and roll the rest of your 401(k) savings to an IRA. This way, 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.


Pick Your Own Custodian

When you opt to put your savings in a 401(k), the money will be held by the 401(k) company your employer chooses. By rolling over to an IRA, you'll have your pick of custodians based on how secure they are and the range of services they offer.


A Wider Array of Investment Opportunities

While some Millstadt, IL businesses provide 401(k) plans that allow for a wide range of 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:

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

Consolidate Your Savings Accounts

If you change jobs frequently, it could be incredibly helpful to combine the funds from all your accounts into one account. In doing so, it won't be nearly as much of a hassle to track the performance of your funds and you will be able to manage them more efficiently. 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 may be eligible to keep contributing to the plan you've picked out.

The financial advisors of Correct Capital will help you decide if a 401(k) rollover is the best option for you. We have over two decades of experience helping both individuals and families and business owners in Millstadt, IL with A-Z 401(k) services. When you meet with us, we'll walk you through special considerations, such as whether a traditional or Roth IRA is best for you.

When Not to Roll Over Your 401(k) into an IRA in Millstadt, IL

Every person's finances vary, and your Millstadt, IL retirement planners at Correct Capital may advise that your investments are better off in a 401(k) account; either your an old plan or rolling them over into a new one. Some reasons to stick with a 401(k) plan rather than 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, there may not be a great reason to roll over your 401(k). the fees change in the future 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 you can begin taking out money without a penalty from either a 401(k) or IRA at 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 need or want the money sooner.
  • Loans from an IRA are not allowed. While taking a loan from retirement savings isn't advisable, 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 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 Millstadt, IL:

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

Rollover 401(k) in Millstadt, IL | Correct Capital

At Correct Capital, we give all of our clients bespoke attention and cater our services and advice to their current financial health, objectives, and time horizon. Our team of retirement consultants, portfolio managers, and financial planners have nearly a century of combined experience assisting Millstadt, IL individuals and families with 401(k) rollovers along with a host of other wealth management services. As fiduciary advisors, we are legally and ethically obligated 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 limitations to the services or investment options we can recommend.

Call us today at 314-930-401K or contact us online to schedule an appointment with one of our experienced 401(k) specialists and financial planners today.

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