Rollover 401(k) in Sappington, MO
Rollover 401(k) in Sappington, MO. Starting a new job in Sappington, MO is exciting, but it can be hard to know what to do with the savings you have in your existing 401(k). Many Sappington, MO residents don't have the time, expertise, or interest to oversee multiple retirement accounts or to understand the best way to approach a 401(k) rollover. At Correct Capital, our dedicated team of 401(k) specialists and financial advisors will help you understand your options. For rollover 401(k) counseling 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 different things you can do with your 401(k) account with your old employer. A professional Sappington, MO financial advisor like those at Correct Capital will analyze your financial situation and guide you towards what will work best for you. Depending on a variety of factors, we may recommend to:
- Leave the funds 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;
- Cash out your 401(k).
The last option is not recommended unless you need money now. Your previous employer will have to withhold 20% of the savings in order to pay taxes on it. You may also face a 10% early withdrawal penalty from the IRS, and you would also have to pay federal, state, and local taxes. That means you might not even see 50% of the account's value.
It is important to note that employers in Sappington, 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.
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Correct Capital Wealth Management's office is physically located in St. Louis, MO, but we serve clients throughout the United States in both personal financial planning and corporate retirement plans.
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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:
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 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 remainder to an IRA. In doing so, 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 significantly more.
Pick Your Own Custodian
In a 401(k) plan, your employer will decide the 401(k) company holding your funds. When you do a 401(k) rollover to a Traditional or Roth IRA, you'll be able to choose your preferred institution based on how secure they are, the ease of their digital platforms, and the other services they offer.
A Wider Array of Investment Opportunities
While some Sappington, MO employers provide 401(k) plans with few limitations on your investment options, 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:
- Stocks
- Bonds
- Certificates of deposit
- Mutual funds
- Exchange-traded funds
- Real estate investment trusts
- Annuities
Consolidate Your 401(k) Plans
If you have several 401(k) plans spread across multiple former employers, it could be incredibly helpful to combine the entirety of your retirement funds into one plan. That way, you much much more efficiently track how your savings are growing and you will be able to manage them more directly. Sustained long-term growth may also be more attainable.
Keep Contributing 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 over two decades of experience advising both individuals and business owners in Sappington, MO with A-Z 401(k) services. When you meet with us, we'll guide you through important considerations, such as how a 401(k) rollover will affect your tax planning.
When to Avoid a 401(k) Rollover in Sappington, MO
Depending on how close you are to retirement and other factors your Sappington, MO retirement planners at Correct Capital may recommend that your investments should be left 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 rather than an IRA include:
- If your current 401(k) plan works for you. If the fees are reasonable and you're getting strong returns, it may be advisable to keep your savings where they are. If the account stops giving you strong returns or you change your mind for another reason, you retain the right to roll over the funds whenever you'd like.
- Avoid early withdrawal penalties if you are 55. While you can begin taking out money without a penalty from both 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. So, a 401(k) may be preferable if you would like to retire a few years early.
- Loans from an IRA are not allowed. While typically not recommended, 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 can put 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) to receive an employer match and keep your retirement assets in one place.
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
Rollover 401(k) in Sappington, MO | Correct Capital
At Correct Capital, we give all of our clients personalized 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 over 75 years of combined experience assisting Sappington, MO individuals and families with 401(k) rollovers in addition to several other wealth management services. As fiduciary advisors, we have a legal and ethical obligation to oversee your account in a way that benefits you and only you. As an independent firm, we will always be direct and unbiased, and there are no limitations to the services or investment options we can recommend.
Call us today at 877-930-4015 or contact us online to schedule an appointment with one of our knowledgeable 401(k) specialists and retirement consultants today.
