>>Retirement Planning      >>IRAs      >>401k Rollover      >>Inheritance Advance      >>Gold Coins
401k rollover information brought to you by FindLocalBanks.com


401k Rollover

What is a 401k rollover?
A 401k rollover is a way for someone to transfer the money in their current 401k plan from one financial institution into another.

Why would I want to do a 401k rollover?
A 401k rollover is commonly done when someone is changing employers and no longer wishes to have their 401k managed by their previous employer. Another reason is that someone may not be happy with the performance their fund manager is currently getting for their 401k.

When I get a 401k rollover, do I have to put the money into another 401k?
No. You may be able to put your money into another 401k with your new employer, but you can also put your money into an Individual Retirement Account(IRA). IRAs are are offered by numerous financial institutions. Each institution can invest your IRA funds into a myriad of investment choices. When shopping for an IRA, be sure to compare any management fees that may be charged by each financial institution.

Do I have to do a 401k rollover when I change employers?
Not necessarily. If you are happy with the performance of your previous employer's plan, you can elect to leave the money in that plan. However, you may not be able to take loans out against your 401k plan since you are no longer with that employer. If you think you may need to take out a loan against your 401k, you might want to consider a 401k rollover.

Why don't I just cash out my 401k plan when I change employers?
If you cash out your plan, 20% of your money will be witheld by your prior employer. Much of this witholding is used to pay the early withdrawl penalty imposed by the IRS. If you use a 401k rollover, you can avoid this penalty and all of your money can continue to grow tax-deferred.


Copyright © 2007-2014 FindLocalBanks.com, all rights reserved.