Rollover 401(k) in Richmond Heights, MO
Professional, Honest, and Experienced Retirement Planners and Financial Advisors
Rollover 401(k) in Richmond Heights, MO. While moving to a new job can be a welcome new opportunity, it can be hard to know what to do with your 401(k) account with your previous employer. Many Richmond Heights, MO residents have found that enlisting the services of qualified financial advisors is the best way to manage a 401(k) rollover. At Correct Capital, our dedicated team of 401(k) experts and financial planners will help you get the most out of your savings. For rollover 401(k) advice in Richmond Heights, MO, reach out to us today at 314-930-401K or contact us online.
What You Can Do With Your Rollover 401(k) in Richmond Heights, MO
In general, you have four options when considering whether to roll over your 401(k). A professional Richmond Heights, MO financial advisor like those at Correct Capital will be able to look at your financial situation and help you decide which option is best for you. Depending on a variety of factors, we may recommend to:
- Leave the money in your former employer's 401(k) plan;
- Roll over your 401(k) to a plan with your new employer;
- Roll over your 401(k) into a Traditional IRA or Roth IRA;
- Take the cash value out of 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 funds in order to pay taxes on it. Depending on how close you are to retirement, the IRS may also take a 20% early withdrawal penalty, and you would potentially pay even more in federal, state, and local taxes. Cashing out could leave you with less than half of the funds.
One last consideration to note is that companies in Richmond Heights, MO are allowed to make you move the money if your account 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 Richmond Heights, MO
Your Richmond Heights, 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:
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 401(k) plan. If part of your 401(k) includes company stock, you can transfer 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 the shares — which is 0%, 15%, or 20%, depending on your income — instead of income tax, which may be considerably more.
Pick Your Own Custodian
In a 401(k) plan, you will not have any control over the 401(k) company that holds your savings. 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.
More of Investment Opportunities
While some Richmond Heights, MO businesses offer 401(k) plans that include a wide range of 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
Combine Your 401(k) Plans
If you have multiple 401(k) plans with previous employers, there are many advantages to combining the entirety of your retirement funds into one account. That will make it easier to follow how your investments are performing and you will be able to manage them more directly. You could also see greater long-term gains.
Continue Adding Money 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. By rolling over the funds into an IRA, you will be able to supplement your savings.
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 assisting both individuals and families and business owners in Richmond Heights, MO with A-Z 401(k) services. When you hire Correct Capital, we'll help you navigate important considerations, for instance whether a traditional or Roth IRA is best for you.
Why Not to Roll Over Your 401(k) into an IRA in Richmond Heights, MO
Each of our client's financial situation is unique, and your Richmond Heights, MO retirement planners at Correct Capital may advise that your investments should be left in a 401(k) account; either your previous employer's or your new one. Some reasons to choose a 401(k) plan over 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. 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 fees if you are 55. While you can begin taking out savings without a fee from either a 401(k) or IRA at 59½, the threshold in a 401(k) for a 10% early withdrawal fee is 55. A 401(k) may be best if you're considering early retirement.
- You cannot take a loan out of an IRA. While taking a loan from retirement savings should only be considered in certain circumstances, it is important to note that you cannot take a loan out of an IRA.
- Your employer can put matching contributions into your 401(k) account. Employers may contribute a dollar-for-dollar or partial match into a 401(k), while an IRA would only include the money you put into it.
Check out some of the other services we offer in Richmond Heights, 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 Richmond Heights, MO | Correct Capital
At Correct Capital, we give all of our clients bespoke guidance 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 over 75 years of combined experience assisting Richmond Heights, MO individuals and families with 401(k) rollovers along with many other wealth management services. As fiduciary advisors, we are legally and ethically bound to oversee your account in a way that benefits you and only you. As an independent firm, we are free to be honest and objective, and we are not bound to only offer you limited investment options.