IRA rollover
Gather the accounts left at former employers into one, and take control of how they are invested.
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What is happening to the 401(k) you left behind? Retirement money scattered across old employers, unmanaged, misses the growth it could have had. A rollover consolidates it into one account you control.
Why it is worth doing
One place to look
Everything in one account means you can see the whole picture and hold a single strategy across it.
A wider set of choices
A 401(k) menu is usually short. An IRA opens up stocks, bonds, funds and annuities, so the portfolio can actually fit you.
Compare against the pension option
The pension payout offered is not automatically the best one available. Taking the lump sum and rolling it over sometimes produces more.
Someone watching it
Adjusting as markets and your goals move, and stripping out fees that are not earning their keep.
Direct and indirect
Direct rollover
The money moves institution to institution without passing through your hands. It is not treated as a distribution, so there is no withholding and no penalty.
Indirect rollover
You receive the money and have sixty days to deposit it. Miss that window and it counts as income, with tax and possibly an early-withdrawal penalty on top.
Check these first
- What your current plan allows If you are still employed, find out whether the plan permits an in-service rollover at all.
- SIMPLE IRA timing Rolling a SIMPLE IRA within two years of opening it can trigger a penalty.
- Roth works differently A Roth cannot be rolled into other plan types, and moving from Traditional to Roth is a conversion, governed by separate rules.
- Options and costs Compare what the new account offers and what it charges before anything moves.
Rollover and tax rules change; take advice before acting. Investments can lose value.
Financial Planning & Insurance
Living benefits Draw on the death benefit early when serious illness arrives. While you are living, for you.
Roth IRA conversion Pay the tax now so withdrawals later are free of it. It does not suit everyone.
Life insurance Coverage for the people left behind, plus benefits you use while living and money toward retirement.
Cancer & critical illness A lump sum on diagnosis, to cover the lost income and the bills. No restriction on how you spend it.