Rollover 401(k) in St. Charles, MO
Professional, Honest, and Experienced Retirement Planners and Financial Advisors
Rollover 401(k) in St. Charles, MO. Starting a new job in St. Charles, MO is exciting, but it can be hard to know what to do with your existing 401(k). Many St. Charles, 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) specialists and financial planners will help you get the most out of your savings. For rollover 401(k) consulting in St. Charles, MO, call us today at 314-930-401K or contact us online.
What You Can Do With Your Rollover 401(k) in St. Charles, MO
Generally speaking, there are four ways to approach your 401(k) rollover. A professional St. Charles, MO financial advisor like those at Correct Capital will analyze your assets, savings, and 401(k) plan and help you decide which option is best for you. Depending on a variety of factors, it may be best to:
- Keep your 401(k) with your old employer;
- 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).
Cashing out should only be considered if you need funds quickly. Your previous employer would be required to withhold 20% of the funds for tax purposed. You may also face a 10% early withdrawal penalty from the IRS, and you would would be subject to federal, state, and local taxes. Cashing out could leave you with less than half of the funds.
Another thing to note is that many businesses in St. Charles, MO obligate you to roll over the funds to an IRA or new 401(k) if your account has less than $5,000 in it. Lastly, 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 St. Charles, MO
Your St. Charles, 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:
Pay Less in Taxes With 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 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 rest of your 401(k) savings 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 — rather than income tax, which is often higher.
The Custodian of Your Choice
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 custodian based on how secure they are and the range of services they offer.
More Diverse of Investment Opportunities
While some St. Charles, MO companies provide 401(k) plans with few limitations on your investment options, you will generally have much more flexibility in an IRA than you would in a 401(k) plan. IRAs typically allow investment in almost any type of asset, including:
- Certificates of deposit
- Mutual funds
- Exchange-traded funds
- Real estate investment trusts
Consolidate Your Savings Accounts
If you have various 401(k) plans with previous employers, it could be incredibly helpful to merge all of your savings into one account. That way, you much much more efficiently track how your savings are performing and managing them will be more streamlined. It may also be the better option for long-term growth.
Keep Contributing 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. If you roll the funds out of your old employer's plan, you will be able to supplement your savings.
The financial advisors of Correct Capital will guide you in your decision of what to do during a 401(k) rollover. We have over two decades of experience advising both individuals and families and business owners in St. Charles, MO with A-Z 401(k) services. When you meet with us, we'll guide you through important considerations, for instance what type of account makes the most sense for your time horizon.
Why Not to Roll Over Your 401(k) into an IRA in St. Charles, MO
Depending on your time horizon and other considerations your St. Charles, MO retirement planners at Correct Capital may recommend that your funds should be left in a 401(k) account; whether that be your previous employer's or your new one. Some reasons to stick with a 401(k) plan instead of an IRA are:
- If you like the benefits of your current 401(k) plan. If the fees are reasonable and the return on investment is good, it may make the most sense to keep your savings where they are. If the account stops performing 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 you can begin taking out money without a fee from both a 401(k) or IRA at 59½, a 401(k) does not include a 10% early withdrawal fee if you are 55. So, a 401(k) may be preferable if you would like to retire a few years early.
- You cannot take a loan out of an IRA. While typically not recommended, if you are in a situation where you need to take out a loan from your retirement savings, it is important to note that you cannot take a loan out of an IRA.
- Your employer may match your 401(k) contributions. Employers may contribute a full or partial match into a 401(k), while you are the only contributor if you put your savings into an IRA.
Click on the links below to see some of the other services we offer in St. Charles, MO:
- 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
- Retirement Calculator
- Retirement Planning
Rollover 401(k) in St. Charles, MO | Correct Capital
At Correct Capital, we give all of our clients bespoke attention and cater our services and advice to their current financial status, goals, and time horizon. Our team of retirement consultants, portfolio managers, and financial planners have over seven decades of combined experience helping St. Charles, MO individuals and families with 401(k) rollovers in addition to several other wealth management services. As fiduciary advisors, we are legally and ethically obligated to manage your account in a way that benefits you and only you. As an independent firm, we are free to be straightforward and objective, and there are no restrictions to the services or investment options we can offer you.