Rollover 401(k) in Town and Country, MO
Rollover 401(k) in Town and Country, MO. While moving to a new job can be a welcome new opportunity, it can also create uncertainty about the best way to manage your 401(k) account with your previous employer. Many Town and Country, MO residents have found that seeking the help of qualified financial advisors is the best way to go about handling a 401(k) rollover. At Correct Capital, our experienced team of 401(k) specialists and financial advisors will help you determine what makes the most sense for you. For rollover 401(k) advice in Town and Country, MO, call us today at 877-930-4015 or contact us online.
What You Can Do With Your Rollover 401(k) in Town and Country, MO
Generally speaking, you have four options when considering whether to roll over your 401(k). A experienced Town and Country, MO financial advisor like those at Correct Capital will analyze your assets, savings, and 401(k) plan and help you determine which option is best for you. Depending on your specific circumstances, 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 advisable unless you need money now. Your previous employer would be obligated to withhold 20% of the funds to prepay the taxes you would owe on it. You may also face a 10% early withdrawal penalty from the IRS, and you would would be subject to federal, state, and local taxes. Meaning, you could potentially lose more than half of the account's value.
It is important to note that many companies in Town and Country, MO require you to move the funds in your 401(k) if your account has less than $5,000 in it. Furthermore, they may be able to cash out your account if it has less than $1,000.
Benefits to Rolling Over a 401(k) into an IRA in Town and Country, MO
Your Town and Country, MO financial advisors at Correct Capital may counsel that rolling over your 401(k) funds into a Traditional or Roth IRA is your best option. There are a variety of advantages 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 increase in value between the cost basis and current value of shares of employer stock in your 401(k) 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 other funds to an IRA. By separating your 401(k) into two accounts, 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 is often higher.
Pick Your Own Custodian
In a 401(k) plan, you will not have any control over the 401(k) company that holds 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.
A Wider Range of Investment Opportunities
While some Town and Country, MO businesses provide 401(k) plans that include a wide range of investment opportunities, IRAs typically offer an individual investor many more options than 401(k) plans. IRAs typically allow investment in almost any type of asset, including:
- Shares
- Bonds
- Certificates of deposit
- Mutual funds
- Exchange-traded funds
- Real estate investment trusts
- Annuities
Combine Your Savings Accounts
If you have various 401(k) plans with previous employers, it may make the most sense to combine all of your savings into one account. That way, you much much more efficiently track the performance of your funds and you will be able to manage them more efficiently. It may also be the better option for long-term growth.
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. 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 help you understand if rolling over a 401(k) is right for you, and which type of rollover is preferred. We have over 20 years of experience advising both individuals and business owners in Town and Country, MO with A-Z 401(k) services. When you hire Correct Capital, we'll help you navigate special considerations, such as whether a traditional or Roth IRA is best for you.
Why Not to Roll Over Your 401(k) into an IRA in Town and Country, MO
Every person's finances vary, and your Town and Country, MO retirement planners at Correct Capital may recommend that your investments are better off in a 401(k) account; either your previous employer's or your new one. Some of the advantages of a 401(k) plan instead of an IRA include:
- If you like the benefits of your current 401(k) plan. If the fees are reasonable and your savings are growing as you'd like them to, there may not be a good reason to roll over your 401(k). 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.
- Avoid 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. So, a 401(k) may be preferable if you would like to retire earlier.
- Loans from an IRA are not allowed. While taking a loan from retirement savings isn't advisable, it is important to note that you cannot take a loan out of an IRA.
- Your employer may match your 401(k) contributions. While some employers will allow you to roll money out of your 401(k) to an IRA before retirement, 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 Town and Country, MO:
- Succession Planning
- Fiduciary Financial Advisor
- Company 401(k) Plans
- ESOP Advisor
- Self-Employed Retirement Plans
- 401(k) For Small Business
Rollover 401(k) in Town and Country, MO | Correct Capital
At Correct Capital, we treat each client individually and get to know them so we can help them achieve their goals. Our team of retirement consultants, portfolio managers, and financial planners have over 75 years of combined experience aiding Town and Country, MO individuals and families with 401(k) rollovers in addition to several other wealth management services. As fiduciary advisors, we are legally and ethically required to do what's best for you and disclose any potential conflicts of interest. As an independent firm, we will always be straightforward and objective, 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 knowledgeable 401(k) experts and retirement consultants today.
