Learn The Stock Market And How to Trade

So you’ve been working at your company for awhile putting some money away into the 401k, having some money matched into a 401k ,and maybe even having a separate profit sharing investment account that you have some vested money in.  Since you left this company (hopefully for something better) why would you leave your money in their accounts?  Not only will it be hard to keep track of, but odds are they get some benefit from who they have managing their 401ks, don’t support them any longer.  It’s time for your 401k rollover. 

401K Rollover Options

1. 401k Rollover To IRA (Individual Retirement Account) - What’s great about this option is it’s flexible.  In a brokerage IRA you can invest in anything that’s allowed to be traded in an IRA.  Anything from mutual funds to stock options the choices are yours.  The bad part is if you’ve new to investing you can kill yourself on over trading and too high of commissions.
2. Rollover To Mutual Fund IRA – This is good because often the commissions are very low since you’ve locked your money in with that one mutual fund company.  If you’re looking for a low stress retirement savings this is the way Dave Ramsey would likely recommend.
3. Rollover To New Company 401K – The best reason for this is if you don’t have much money you are rolling over because your new company 401k won’t have any account minimums.  It’s also good if you have a really hard time keeping track of your accounts as it is.  I don’t like how locked into few choices it generally gives you unless you are now working for one of the mega corporations.

As for 401k rollover rules I don’t dare bore you readers with legalistic rules that will change by the time you read this anyways.  So please check the rules and forms of where you are rolling over from, then check the rules and forms of where you are rolling over to, then check with you tax adviser (because my lawyer says so.)

There are minor difference is withdrawal rules between a 401k and an IRA to consider especially if you’re near retiring so keep that in mind as you make your decision, though it will be very unique to your situation.

Related posts:

1. 401K Loans – Worth the Risk?
2. Which is best? Roth IRA VS 401K
3. Want to Make Money Stock Market Trading? Then You Need Money to Stock Market Trade
4. Retirement Savings Accounts
5. Roth IRA Rules and Rates