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OR GET YOUR COMPLIMENTARY 401k ROLLOVER GUIDE BELOW.

If You'd Like to Have a Conversation About Your 401k Retirement Options, I'd Be Happy To Help.

Think You’re Ready to Roll?

So you’re changing jobs or retiring. Congratulations on a new adventure. The question is “should I roll over my 401k?” Should I cash it out, leave it with my former employer, roll it to my new employer, or roll it over into an IRA? You’ve got a lot on your plate and we know this can be a bit overwhelming at times, so that’s where we come in.

Our goal is to educate you about your options and then help you simply and easily proceed with what’s best for you and your 401k retirement plan. We can even provide a professional to personally guide you through the process so you don’t have to worry about it and you can make sure it’s done right. We can help you get organized and get clarity on how you envision your financial future; and then design a plan with the goal of helping you get there.

Below we’ve outlined the four basic courses of action with regard to your 401k rollover options. If you’re retiring soon or even within the next 10 years; it’s very important to understand that while a 401k can be a good way to invest for retirement, it will not provide guaranteed income for the rest of your life. That means you could run out of money in the middle of retirement.

So make sure you ask a Transamerica Financial Professional about IRA rollover options that provide reliable income throughout your entire retirement. The last thing you want during your golden years is to be stressed about the stock market and the possibility of running out of money to soon.

"Failure to plan is planning to fail"

~ Benjamin Franklin ~

401k Rollover Options

People change jobs for a variety of reasons, and navigating these transitions can be challenging. When you leave work – for whatever reason – you have a decision to make about the money in your retirement plan. Generally, you have four main options to choose from.

Roll Over Your 401k Into an IRA

Advantages:

You can consult with a financial advisor to help you choose an appropriate investment strategy and answer retirement planning questions.
Investment gains in your account remain tax-deferred.
Avoid early withdrawal penalties and taxes associated with cashing out your account.
Consolidation of your retirement assets may make asset allocation and rebalancing easier.
Gain independence from your former employer.

Disadvantages:

You cannot borrow money against an IRA.
Assets may not be fully protected from the claims of some creditors.
You may lose access to features and benefits of an employer-sponsored plan that are important to you.
Review the fees and expenses you pay, including any charges associated with transferring your account, to see if rolling over into an IRA or consolidating your accounts could help reduce your costs.

Employer-sponsored retirement plans may have features that you may find beneficial such as access to institutional funds, fiduciary-selected investments, and other ERISA protections not afforded other investors.

In deciding whether to do a transfer from a retirement plan, be sure to consider whether the asset transfer changes any features or benefits that may be important to you. 

Leave Your Money in Your Former Employer’s Plan

Advantages:

Investment gains in your account remain tax-deferred.
Avoid early withdrawal penalties and taxes associated with cashing out your account.
Fiduciary oversight is managed by the plan trustee.
Penalty-free withdrawals may be made from the plan if you are 55 or older the year you separate from service.
Assets are protected from the claims of creditors.

Disadvantages:

You typically cannot contribute additional outside assets to the plan.
Your investment options may be limited to what's offered by the plan.
Some retirement plans do not offer flexible distribution options, such as systematic withdrawals.
Many employer-sponsored retirement plans do not offer participants access to advice. If your former employer's plan is with Transamerica, you'll still have access to a retirement advisor for general retirement questions.

Roll Over 401k to New Employer’s Plan

Advantages:

Investment gains in your account remain tax-deferred.
Avoid early withdrawal penalties and taxes associated with cashing out your account.
Fiduciary oversight is managed by the plan trustee.
Assets are protected from the claims of creditors.

Disadvantages:

The new employer's plan may not allow rollovers from previous employer-sponsored plans.
The new employer's plan may have less flexibility than an IRA and may have fewer investment options.
Review the fees and expenses you pay, including any charges associated with transferring your account, to see if consolidating your accounts could help reduce your costs. Be sure to consider whether such a transfer changes any features or benefits that may be important to you. 

Cash Out Your 401k Retirement Plan

Advantages:

You will have cash readily available.

Disadvantages:

You will lose the opportunity for tax-advantaged growth and compounding.
You could be subject to a 10% federal tax penalty (if you cash out before age 59½).
The IRS requires withholding of 20% as prepayment of your federal income tax.
You may also be subject to state withholding for prepayment of state income taxes.
You could pay more in income taxes. 

There are so many options and even with the information shared here about your 401k rollover options, you still might feel overwhelmed and may want a guide or a financial advisor to talk about all of the options in more detail to see which would be the best 401k rollover options for your own retirement planning goals and personal situation.

To get your own 401k rollover guide and learn more about your 401k rollover options, fill out the short form on this page and you will receive more information about a Transamerica 401k rollover guide that will help you get a clearer picture of your retirement.

Financial Advisors, Transamerica. “401k Rollover Guide.” transamerica.com. TFA, 19 Aug. 2019. Web. 26 Aug. 2019.
(Source: Transamerica Financial Advisors Inc.) 

OR TALK WITH ME DIRECTLY

If You'd Like to Have a Conversation About Your 401k Rollover Options, I'd Be Happy To Help, No Obligation or Cost, Just Me Answering Your Questions

Eric Jenson
Financial Advisor in Denver Colorado

720-259-6256
5350 S Roslyn St #240,
Greenwood Village, CO 80111
eric.jenson@tfaconnect.com