Rollover 401(k) in Olivette, MO
Rollover 401(k) in Olivette, MO. While moving to a new job can be a welcome new opportunity, it can also lead to uncertainty about the best way to manage the savings you have in your existing 401(k). Many Olivette, 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 dedicated team of 401(k) experts and retirement planners will help you get the most out of your savings. For rollover 401(k) counseling in Olivette, MO, call us today at 314-930-4015 or contact us online.
What You Can Do With Your Rollover 401(k) in Olivette, MO
Generally speaking, there are four ways to approach your 401(k) rollover. A professional Olivette, MO financial advisor like those at Correct Capital will analyze your assets, savings, and 401(k) plan and guide you towards your preferred option. Depending on a variety of factors, it may be best to:
- Leave the savings 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;
- Cash out your 401(k).
Taking out the cash value should only be considered if you need funds quickly. Your previous employer will have 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 would be subject to federal, state, and local taxes. That means you might not even see 50% of your savings.
It is important to mention that companies in Olivette, MO are allowed to make you move the money if your plan 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 Olivette, MO
Your Olivette, MO financial advisors at Correct Capital may suggest 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 market value of shares of employer stock in your 401(k) account. If part of your 401(k) includes company stock, you can put that difference into a standard brokerage account, and roll the rest of your 401(k) savings to an IRA. In doing so, you may pay long term capital gains tax on the shares — which caps out at 20% for the highest earners — rather than income tax, which may be significantly more.
The Custodian of Your Choice
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 be able to choose your preferred institution based on how secure they are and the range of services they offer.
A Wider Range of Investment Options
While some Olivette, MO companies offer 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:
- Stocks
- Bonds
- Certificates of deposit
- Mutual funds
- ETFs
- Real estate investment trusts
- Annuities
Combine Your 401(k) Plans
If you have several 401(k) plans spread across multiple former employers, it may make the most sense to merge the funds from all your accounts into one account. That way, you much much more efficiently follow how your savings are growing and you will be able to manage them more efficiently. Sustained long-term growth may also be more attainable.
Continue Adding Money to Your Accounts
While your money will still grow in you old 401(k) plan, you will no longer be able to contribute more savings to it. 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 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 assisting both individuals and business owners in Olivette, MO with A-Z 401(k) services. When you hire Correct Capital, we'll help you navigate important considerations, for instance how a 401(k) rollover will affect your tax planning.
When Not to Roll Over Your 401(k) into an IRA in Olivette, MO
Depending on your time horizon and other factors your Olivette, MO retirement planners at Correct Capital may recommend that your investments are best kept 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 you're getting strong returns, it may be your best option to keep your savings where they are. the fees change in the future or you change your mind for a different reason, you can still roll over your 401(k) at any time.
- No early withdrawal fees if you are 55. While both 401(k)s and IRAs permit withdrawals when you are 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.
- You cannot take a loan out of an IRA. 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. Employers may contribute a full or partial match into a 401(k), while an IRA would only include the money you put into it.
Take a look at some of the other services we offer in Olivette, 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
- Social Security Consultants Near Me
Rollover 401(k) in Olivette, MO | Correct Capital
At Correct Capital, we give all of our clients bespoke attention and tailor 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 aiding Olivette, MO 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 act only in your best interested. As an independent firm, we are free to be honest and unbiased, and we are not bound to only offer you limited investment opportunities.
Call us today at 314-930-4015 or contact us online to schedule an appointment with one of our experienced 401(k) specialists and financial planners today.
