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 be hard to know what to do with 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) experts and retirement consultants will help you understand your options. For rollover 401(k) counseling in Town and Country, MO, call us today at 314-930-401K or contact us online.
Rollover 401(k) Options in Town and Country, MO
Generally speaking, you have four options when considering whether to roll over your 401(k). A qualified Town and Country, MO financial advisor like those at Correct Capital will be able to look at your financial situation and guide you towards your preferred option. Depending on your current financial health and your time horizon, 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).
Cashing out should only be considered if you need funds quickly. Your previous employer will have to withhold 20% of the balance to prepay the taxes you would owe on it. You may also face a 10% early withdrawal penalty from the IRS, and you would potentially pay even more in federal, state, and local taxes. That means you might not even see 50% of your savings.
One last consideration to mention is that many employers in Town and Country, MO require you to roll over the funds to an IRA or new 401(k) if your account has less than $5,000 in it. Additionally, 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 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 company stock in your 401(k) account. If you won shares of your previous company in your 401(k), you can put 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 significantly more.
Pick Your Own Custodian
When you opt to put your savings in a 401(k), you will not have any control over the 401(k) company that holds your funds. By rolling over to an IRA, you'll have your pick of institutions based on stability, trading technology, and financial services.
More Diverse of Investment Opportunities
While some Town and Country, MO companies offer 401(k) plans with few limitations on your investment opportunities, most retirement planners find that IRAs offer more control and flexibility than employer-limited 401(k) plans. IRAs typically allow investment in almost any type of asset, including:
- Stocks
- Bonds
- Certificates of deposit
- Mutual funds
- ETFs
- Real estate investment trusts
- Annuities
Consolidate Your Savings Accounts
If you have multiple 401(k) plans with previous employers, there are many advantages to merging the entirety of your retirement funds into one place. That will make it easier to track how your savings are performing and managing them will be more streamlined. You could also see greater long-term gains.
Keep Contributing to Your Accounts
While you can still reap the benefits of the investments and savings that are already there, you won't be able to add funds to a 401(k) plan with your previous employer. If you roll the funds out of your old employer's plan, 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 Town and Country, MO with numerous 401(k) services. When you hire Correct Capital, we'll help you navigate important considerations, such as required minimum distribution model makes the most sense for you.
Why to Avoid a 401(k) Rollover in Town and Country, MO
Each of our client's financial situation is unique, and your Town and Country, MO retirement planners at Correct Capital may recommend that your investments are best kept in a 401(k) account; either your previous employer's or your new one. Some reasons to choose a 401(k) plan rather than an IRA are:
- If your current 401(k) plan works for you. 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. 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 penalties if you are 55. While both 401(k)s and IRAs allow for withdrawals when you are 59½, the threshold in a 401(k) for a 10% early withdrawal fee is 55. A 401(k) may be best if you need or want the money sooner.
- 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) account. 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 stick with a 401(k) your employer will match your contributions.
Take a look at some of the other services we offer in Town and Country, MO:
- 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 Town and Country, MO | Correct Capital
At Correct Capital, we give all of our clients personalized attention and cater our services and advice to their current financial status, objectives, and time horizon. Our team of retirement consultants, portfolio managers, and financial planners have over seven decades of combined experience aiding Town and Country, MO individuals and families with 401(k) rollovers as part of our comprehensive wealth management services. As fiduciary advisors, we have a legal and ethical imperative to act only in your best interested. As an independent firm, we are free to be straightforward and unbiased, and there are no restrictions to the services or investment opportunities we can recommend.
Give us a call today at 314-930-401K or contact us online to schedule an appointment with one of our experienced 401(k) specialists and retirement consultants today.
