401(k) Rollover services Planning
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?”
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:
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:
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.
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.
Before deciding, consider your current employer plan’s investment choices, expenses, services and features.
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.
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. Additionally, depending on your age and circumstances, the cash you receive could also be subject to the 10% early distribution penalty.
Understanding how the rules apply to your situation before choosing this route can help avoid an unwelcome surprise come tax time the following year.
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 evaluating the choices available to you.
You’ll work directly with Ed — one advisor who sees your entire financial picture.
There is no charge to discuss your old 401(k) and review your options with us.
At E.P. Wayne Financial Group, planning is part of the relationship, not a separate service with a separate fee. The work we do to understand your situation and build your plan comes with working together, not as a line item.
If you decide to work with us, you choose the type of relationship, advisory, brokerage, or a combination, based on what fits your situation. In an advisory relationship, we serve as your fiduciary advisor.
If you’re not staying in the workforce and find yourself with an old 401(k) because you’ve retired, see our guide to what to do with your 401(k) when you retire.
The Goal Isn’t Simply to Move the Money
The goal is to make a good decision about where your old 401(k) belongs and how it fits into your retirement plan.
E.P. Wayne Financial Group provides 401(k) rollover services planning in Columbia, SC, from our office in Forest Acres.
Have an old 401(k)?
Talk to a local independent financial advisor before you decide. We’ll help you understand your options — including leaving it where it is — and determine whether we can help.