Your 401(k), or similar employer sponsored retirement savings plan, as among the hardest-working vehicles for amassing retirement savings. However, when left behind following a job change, it may no longer be working as hard as you need it to. That’s because certain key benefits may no longer apply once you sever ties with your employer. Chief among them is that you are no longer eligible to make additional contributions or receive employer matching contributions. And what’s out of sight is also often out of mind. Sitting with your former employer, those important assets may not be getting the attention they deserve as an integral part of your overall retirement wealth. Fortunately, there is a strategy to get your retirement plans back on track and working toward your goals. With an IRA rollover, you realize immediate benefits. 1) You gain a more complete view of your financial picture by consolidating 401k or other qualified retirement plans. Limitations, restrictions, and fees may apply. 2) It also may become easier to manage your entire investment portfolio, maintaining diversification and eliminating any gaps or overlap in your overall investment strategy. 3) Best of all, you are no longer limited by the investment choices selected by your former employer. And that can have a significant impact in pursuing your retirement goals. Some employer plans may limit investment choices to a handful of investment options and static model portfolios. A rollover provides access to a broader range of investments, including mutual funds, stocks, bonds, exchange-traded funds, U.S. Treasuries, and more, depending on your investment goals, preferences, time frame, and risk tolerance. Working with a professional financial advisor to roll over your 401k assets also has significant benefits. Your financial advisor can provide the objective, unbiased advice you seek, because he or she does not sell or promote proprietary investment products. That ensures your best interests always come first as you develop a comprehensive investment strategy aligned with your goals and objectives….(read more)

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A 401k / IRA Rollover is a process of transferring retirement savings from one retirement account to another. This process is often used when an individual changes jobs and wants to move their retirement savings from the 401k plan of their former employer to an IRA. It is also used when individuals want to consolidate multiple retirement accounts into one.

When rolling over a 401k to an IRA, the individual must first decide which type of IRA they want to open. There are two main types of IRAs, Traditional IRAs and Roth IRAs. The type of IRA chosen will depend on the individual’s specific financial goals and tax situation.

Once the type of IRA is chosen, the individual will need to open an account with a financial institution. This can be done online or in person. The individual will need to provide the financial institution with information about their former 401k plan, including the account number and the name and address of the plan administrator.

The next step is to contact the plan administrator of the former 401k and request a “direct rollover”. This means that the funds will be transferred directly from the former employer’s plan to the individual’s new IRA. If the individual chooses to receive a check, they will be subject to taxes and a 10% early withdrawal penalty if they are under the age of 59 ½.

Once the funds have been transferred to the new IRA, the individual can then decide how to invest the money. They can choose from a variety of investments, including stocks, bonds, mutual funds, and exchange-traded funds.

A 401k / IRA Rollover is a great way for individuals to keep their retirement savings in one place and benefit from the advantages of an IRA. It is important to understand the process and the potential tax implications before beginning.