401K Rollover and Optimization From Iron Point Financial

Helping You Decide Between Four 401K Rollover Options

Whether you are switching jobs, or want to diversify your funds, a 401K rollover may be the best route for you.

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401K Rollover and Optimization

Who Is This For?

401K rollover and optimization are designed for those looking to transition from one job to another or have recently retired and need to move their 401K account into a different retirement savings plan. It can also be used by those who already have an existing traditional IRA or Roth IRA and want to consolidate their retirement funds for better diversification, lower fees, and potential tax savings. Depending on your circumstances, we can help you explore which option is best for you.

What Is 401K Rollover and Optimization?

When leaving your employer, it’s essential to consider the many available retirement plan options. Are you retiring or changing jobs? If yes, one key question is whether to roll over your former employee’s 401(k) into a Traditional IRA or Roth IRA. However, if that doesn’t seem suitable for you right now, take some time and consider these other three alternatives:

Keeping the money in the old 401(k)
Moving it to a new job’s 401(k)
Cashing out with tax consequences

Option 1: Roll over your 401K to a Traditional or Roth IRA

Transferring your 401(k) into an IRA can be a beneficial decision, as it provides various advantages:

Ability to add money: Make sure to capitalize on the chance to contribute funds into your IRA, as long as you fulfill income requirements. Consolidating all your retirement savings and accounts into one may make it easier for you to monitor investments and simplify account info during tax season.
Investment choices: Compared to employer plans, Traditional and Roth IRAs open up a broader range of investment opportunities. Nevertheless, you may not be able to access the same investments in your current plan.
Available services: Our talented financial advisors can evaluate your 401(k) rollover opportunities and form an investment approach centered on your individual needs and aspirations.
Fees and expenses: When investing in an IRA, you can expect to pay annual account fees, investment-related costs, and termination charges.
Penalty-free distributions: Typically, you can access money from an IRA without tax penalties when you reach the age of 59½.
Required minimum distributions: Generally, it is mandated that individuals start taking minimum distributions from a traditional IRA at the age of 72.

Option 2: Leaving money in your former employer's 401K Plan

When you’re evaluating whether or not to remain with your existing company for your 401(k), remember that the plan’s terms of service will indicate if this is a viable option. Additionally, the ability to add funds and select investments is contingent on these same parameters. Here’s what else you should be aware of:

Ability to add money: After you depart from your job, it’s typically impossible to add funds to the plan.
Investment choices: 401(k) plans include fewer investment options than an IRA. However, they permit you access to investments that are out of reach with an IRA.
Available services: Many plans offer educational materials, planning tools, support helplines, and workshops to help you make sound financial decisions. Depending on the plan, access to a professional financial advisor may also be available for additional advice.
Fees and expenses: 401(k) fees and expenses can range from administrative costs and investment-related charges to distribution fees. Regarding retirement planning, these costs are usually lower than those of an IRA plan.
Penalty-free distributions: As a general rule, you can withdraw money from your retirement plan without incurring any tax penalties when you reach the age of 55 – provided that it is within the same calendar year in which you leave your job.
Required minimum distributions: Generally, you must withdraw the minimum amount from your former employer’s plan when you reach age 72.

Option 3: Move the money to your new employer's 401K plan

Looking at your current 401(k) plan will allow you to discern whether or not a shift in investments is truly viable for you. This will allow you to discern whether or not this shift in investments is truly viable for you. Before making any moves, remember that the outcome is contingent upon the specifics of your current plan. Here are some things to consider:

Ability to add money: When you meet the criteria of your workplace’s plan, adding money to it is usually straightforward. What’s more, consolidating your retirement accounts simplifies tracking investments and will lessen the paperwork pile at tax time. So don’t hesitate; take advantage of this opportunity today!
Investment choices: 401(k) plans have a relatively smaller selection of investment options compared to an IRA, although they may offer some that cannot be accessed through an IRA.
Available services: With some plans, you can access various educational materials and planning tools. You may even receive a call from their telephone helpline or attend one of their workshops. Plus, depending on your chosen plan, you could enjoy privileged access to financial advisors too!
Fees and expenses: 401(k) fees and costs may be lower than IRA fees and expenses, usually consisting of administrative charges, distribution costs, and expenditure-related payments. By establishing a 401(k) you can quickly and responsibly manage your retirement savings without stressing about money.
Penalty-free distributions: In most cases, you can withdraw funds from your plan without being subject to penalties on taxes when you reach the age of 55 — provided that it’s in the same calendar year as you leave your place of employment.
Required minimum distributions: Unless you are still employed by the company, at age 72, it is generally required that minimum distributions from your plan commence.

Option 4: Cashing out your 401K

Ability to add money: When you meet the criteria of your workplace’s plan, adding money to it is usually straightforward. What’s more, consolidating your retirement accounts simplifies tracking investments and will lessen the paperwork pile at tax time. So don’t hesitate; take advantage of this opportunity today!
Investment choices: 401(k) plans have a relatively smaller selection of investment options compared to an IRA, although they may offer some that cannot be accessed through an IRA.
Available services: With some plans, you can access various educational materials and planning tools. You may even receive a call from their telephone helpline or attend one of their workshops. Plus, depending on your chosen plan, you could enjoy privileged access to financial advisors too!
Fees and expenses: 401(k) fees and costs may be lower than IRA fees and expenses, usually consisting of administrative charges, distribution costs, and expenditure-related payments. By establishing a 401(k) you can quickly and responsibly manage your retirement savings without stressing about money.
Penalty-free distributions: In most cases, you can withdraw funds from your plan without being subject to penalties on taxes when you reach the age of 55 — provided that it’s in the same calendar year as you leave your place of employment.
Required minimum distributions: Unless you are still employed by the company, at age 72, it is generally required that minimum distributions from your plan commence.

401k Rollover Disclosure: Consider all available options, which include remaining with your current retirement plan, rolling over into a new employer’s plan or IRA, or cashing out the account value. When deciding between an employer-sponsored plan and IRA, there may be important differences to consider – such as range of investment options, fees and expenses, availability of services, and distribution rules (including differences in applicable taxes and penalties). Depending on your plan’s investment options, in some cases, the investment management fees associated with your plan’s investment options may be lower than similar investment options offered outside the plan. The opinions contained in this material are those of the author, and not a recommendation or solicitation to buy or sell investment products. This information is from sources believed to be reliable, but Cetera Advisor Networks LLC cannot guarantee or represent that it is accurate or complete.

How Do I Get Started?

Schedule An Appointment

In this call (or in-person meeting) we listen to you & assess your goals. We will begin to take you through our Investment Roadmap Tool® to determine how to get from where you are now to where you want to be.

Create a Clear Plan

From this call, if we find that we are a good fit for one another, we will develop & execute a plan that has been custom built for you to work towards your investment goals.

Evaluate Your Progress

We will meet with you each year to review and adjust your plan so you can face your future with confidence. Being confident in your progress gives you the freedom to invest your life in what matters most.

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Neither Cetera Advisor Networks nor its representatives offer tax or legal advice. Please consult your tax advisor or attorney for guidance. While the process of diversifying your assets across multiple asset classes can help to reduce overall risk, it does not eliminate market risk altogether.

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