Rollover 401(k) in Weldon Spring, MO
Professional, Honest, and Experienced Retirement Planners and Financial Advisors
Rollover 401(k) in Weldon Spring, MO. While moving to a new job can be a welcome new opportunity, it can also lead to confusion about the best way to handle the savings you have in your existing 401(k). Many Weldon Spring, MO residents have found that enlisting the services of qualified financial advisors is the best way to go about handling a 401(k) rollover. At Correct Capital, our dedicated team of 401(k) specialists and retirement planners will help you get the most out of your savings. For rollover 401(k) consulting in Weldon Spring, MO, call us today at 314-930-401K or contact us online.
Rollover 401(k) Options in Weldon Spring, MO
Typically, you have four options when considering whether to roll over your 401(k). A experienced Weldon Spring, MO financial advisor like those at Correct Capital will be able to look at your finances and help you determine which option is best for you. Depending on a variety of factors, we may recommend 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;
- Cash out your 401(k).
Cashing out is not recommended unless you need money now. Your previous employer would be required to withhold 20% of the savings in order to pay taxes on it. Depending on how close you are to retirement, the IRS may also take a 20% early withdrawal penalty, and you would potentially pay even more in federal, state, and local taxes. That means you might not even see half of the account's value.
Another thing to mention is that many employers in Weldon Spring, MO obligate 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 the balance is less than $1,000.
Benefits to Rolling Over a 401(k) into an IRA in Weldon Spring, MO
Your Weldon Spring, MO financial advisors at Correct Capital may advise 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 difference between the cost basis and current value of shares of employer stock in your retirement plan. If part of your 401(k) includes company stock, you can transfer that increase in value into a standard brokerage account, and roll the other funds to an IRA. In doing so, you may pay long term capital gains tax on the shares — which is usually 15% but can go up to 20% for people with high-income — rather than income tax, which may be substantially more.
Pick Your Own Financial Institution
In a 401(k) plan, you will not have any control over the 401(k) company that holds your savings. 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 and the range of services they offer.
A Wider Array of Investment Opportunities
While some Weldon Spring, MO employers provide 401(k) plans with few limitations on your investment options, you will generally have much more control over 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 401(k) Plans
If you change jobs frequently, it may make the most sense to incorporate the entirety of your retirement funds into one account. That way, you much much more efficiently track how your savings 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 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 continue adding more money over time.
The financial advisors of Correct Capital will help you decide if a 401(k) rollover is the best option for you. We have more than two decades of experience helping both individuals and business owners in Weldon Spring, MO with A-Z 401(k) services. When you hire Correct Capital, we'll walk you through special considerations, for instance required minimum distribution model makes the most sense for you.
Why to Avoid a 401(k) Rollover in Weldon Spring, MO
Every person's finances vary, and your Weldon Spring, MO retirement planners at Correct Capital may recommend that your savings are best kept in a 401(k) account; either your an old plan or rolling them over into a new one. Some reasons to stick with a 401(k) plan over an IRA are:
- If your current 401(k) plan works for you. If the fees are fair and your savings are growing as you'd like them to, there may not be a great 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 fees if you are 55. While you can begin taking out funds without a fee from either a 401(k) or IRA at 59½, you will not face 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 earlier.
- Loans from an IRA are not allowed. While typically not advisable, if you are in a situation where you need to take out a loan from your retirement savings, it is important to mention that you cannot take a loan out of either a Traditional or Roth 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 while you are still working, it may make more sense to keep contributing to your 401(k) your employer will match your contributions.
Take a look at some of the other services we offer in Weldon Spring, 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 Weldon Spring, MO | Correct Capital
At Correct Capital, we treat each client individually and get to know them so we can help them realize their objectives. Our team of retirement consultants, portfolio managers, and financial planners have nearly a century of combined experience assisting Weldon Spring, MO individuals and families with 401(k) rollovers in addition to several other wealth management services. As fiduciary advisors, we are legally and ethically bound to do what's best for you and disclose any potential conflicts of interest. As an independent firm, we will always be direct and objective, and we are not bound to only offer you limited investment opportunities.