401(k) Rollover Planning in Columbia, SC
Don't Start With the Rollover. Start With the Decision.
Leaving a job usually creates a long list of things to take care of. Your old 401(k) shouldn't be something you move simply because you received a rollover form. You have choices.
You may be able to leave the money in your former employer's plan, move it to a new employer's 401(k), roll it into an IRA, or take the money out.
The question is not “Where can I move my 401(k)?”
The better question is “What should I do with it?”
At E.P. Wayne Financial Group, we help you look at that decision in the context of your entire financial picture—not just the account you're holding.
Your Old 401(k) Deserves a Closer Look
For many people approaching retirement, a former employer's 401(k) represents a significant part of their accumulated retirement savings. That makes the decision worth slowing down for.
Before moving the money, we think you should understand:
- What you're paying now
- What investment choices you have
- What alternatives are available
- What services and advice come with each option
- How the decision could affect taxes
- How you'll access the money when you retire
- How the account fits with your other investments and retirement income
Sometimes the best decision is to leave the money where it is. Sometimes moving it to a new employer's plan makes more sense. Sometimes an IRA is the better fit.
And sometimes taking the money out is appropriate—but it can also create tax consequences that deserve careful consideration.
There isn't a rollover decision that is right for everyone.
Four Options to Consider
1. Leave It in Your Former Employer's 401(k)
You may be able to keep your money in your former employer's plan and there may be good reasons to do that. The plan may have competitive investment options, reasonable expenses or features that are valuable to you.
Leaving the account where it is can be an intentional decision.
2. Move It to Your New Employer's 401(k)
If your new employer's plan accepts rollovers, consolidating your old account into your current 401(k) may make sense.
It can simplify your retirement accounts and keep your savings in an employer-sponsored plan. But don't assume the new plan is better simply because it's new.
Look at the investment choices, expenses, services and features before deciding.
3. Roll It Into an IRA
An IRA can provide access to a wider range of investments and may give you more flexibility in how your retirement assets are managed. But an IRA isn't automatically the better choice either.
Investment expenses, advisory fees, available services, withdrawal options and how the account would be managed should all be part of the comparison.
A rollover recommendation should make sense as part of your retirement strategy—not simply because an IRA offers more investment choices.
4. Take the Money Out
You can generally take a distribution from an old 401(k), but this option deserves particular attention. Taking the money out can create taxable income and, depending on your circumstances, may result in an additional tax penalty.
If you need the money, that's one conversation.
If you're simply trying to decide what to do with an old account, taking a taxable distribution may create a problem that you didn't need to create.
How We Approach an Old 401(k)
Our process starts with a conversation. Our first step isn't recommending a rollover. It's understanding your situation and looking at the choices available to you.
We also explain how our services are structured and how we're compensated so you can make an informed decision. There is no reason to move a 401(k) just to move it.
The goal isn't simply to move the money. It's to make a good decision about where it belongs and how it fits into your retirement plan.