Rollover 401(k) in Sappington, MO
Rollover 401(k) in Sappington, MO. While moving to a new job can be a welcome new opportunity, it can be hard to know what to do with the savings you have in your 401(k) account with your previous employer. Many Sappington, MO residents don't have the time, expertise, 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) experts and financial advisors will help you determine what makes the most sense for you. For rollover 401(k) advice in Sappington, MO, give us a call at 877-930-4015 or contact us online.
Rollover 401(k) Options in Sappington, MO
Typically, there are four ways to approach your 401(k) rollover. A professional Sappington, MO financial advisor like those at Correct Capital will be able to look at your assets, savings, and 401(k) plan and guide you towards what will work best for you. Depending on your current financial health and your time horizon, it may be best to:
- Keep your 401(k) with your old employer;
- 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).
Cashing out is not recommended unless you need money now. Your previous employer would be obligated to take out 20% of the balance for tax purposed. Depending on your age, the IRS may also withhold a 20% early withdrawal penalty, and you would also have to pay federal, state, and local taxes. Cashing out could leave you with less than 50% of your savings.
Another thing to note is that many businesses in Sappington, MO require you to roll over the funds to an IRA or new 401(k) if your plan has less than $5,000 in it. Furthermore, 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 Sappington, MO
Your Sappington, MO financial advisors at Correct Capital may suggest 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 cost basis and current value of shares of employer stock in your retirement account. If part of your 401(k) includes company stock, you can transfer that portion of your account into a standard brokerage account, and roll the remainder to an IRA. The advantage of this is that you may pay long term capital gains tax on your company stock — which caps out at 20% for the highest earners — instead of income tax, which may be considerably more.
The Custodian of Your Choice
In a 401(k) plan, 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 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 Sappington, MO companies offer 401(k) plans with few limitations on your investment options, most retirement planners find that IRAs offer more control and flexibility than employer-limited 401(k) plans. 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 have several 401(k) plans spread across multiple former employers, it may make the most sense to combine all of your savings into one account. In doing so, it won't be nearly as much of a hassle to track how your investments are growing 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 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 continue adding more money over time.
The financial advisors of Correct Capital will guide you in your decision of what to do during a 401(k) rollover. We have over 20 years of experience helping both individuals and families and business owners in Sappington, MO with comprehensive 401(k) services. When you hire Correct Capital, we'll walk you through important considerations, such as how a 401(k) rollover will affect your tax planning.
Why Not to Roll Over Your 401(k) into an IRA in Sappington, MO
Each of our client's financial situation is unique, and your Sappington, MO retirement planners at Correct Capital may advise that your investments 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 instead of an IRA are:
- If your current 401(k) plan works for you. If the fees are reasonable and you're getting strong returns, it may be your best option to keep your savings where they are. If the account doesn't perform as well or you change your mind for another reason, you retain the right to roll over the funds whenever you'd like.
- No early withdrawal penalties if you are 55. While both 401(k)s and IRAs allow for withdrawals when you are 59½, a 401(k) does not include a 10% early withdrawal fee if you are 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 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 while you are still working, it may make more sense to keep contributing to your 401(k) your employer will match your contributions.
Click on the links below to see some of the other services we offer in Sappington, 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 Sappington, MO | Correct Capital
At Correct Capital, we give all of our clients bespoke guidance 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 Sappington, MO 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 honest and unbiased, and we are not bound to only offer you limited investment options.
Call us today at 877-930-4015 or contact us online to schedule an appointment with one of our qualified 401(k) experts and retirement consultants today.
