WHAT TO DO WITH YOUR 401K AFTER LEAVING YOUR JOB
Whether you’re starting a new job or retiring, here’s what you need to know about your retirement plan.
Rollover 401k to ira
You may also consider moving your funds into an IRA rollover.
- An IRA rollover can simplify things if you change jobs again because you own it outright (rather than it being administered by an employer).
- And IRA rollovers may give you a wider range of investment options than your employer’s 401k retirement plan.
- You will have to make your own investment decisions, and you must start taking the RMD at age 72, even if you are still employed.
Before you do decide to open an IRA rollover with the 401k from your former employer, here are some things to consider:
- The available investment options for diversification.
- Any costs and account-related fees and expenses.
- The account’s service-level availability.
- Whether the account offers penalty-free withdrawals between ages 55 and 59½.
- Whether loans are permitted within the account.
- Whether there is legal protection from creditors under federal law.
- The amount of the RMD once you reach age 72.
- Any factors relating to employer stock.
- Any state tax considerations.
There is a lot to think about when deciding what to do with your 401k when leaving a job. An independent financial advisor can help you decide which option is right for you.
Neither Edelman Financial Engines nor its affiliates offer tax or legal advice. Interested parties are strongly encouraged to include your qualified tax and/or legal professionals in these discussions and decisions to help determine the best options for your particular circumstances.