Have you ever thought, “What is a 401k Rollover to an IRA?”

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by Mike Rowan www.Erollover.com 2008

What is a “401k ROLLOVER into an IRA”?

Generally, after a person leaves the employment of a company, they are given the
option to roll their 401K or other plans into a new company’s plans, if available, or into
a Rollover IRA.

Frequently, the choice is made to roll into an IRA because of the flexibility and vast array
of investment choices available. Once in an IRA, the owner is no longer restricted to the
investment choices offered by their employer plan, nor is the participant subject to any
potential future restrictions imposed by the new employer, if any.

Most retirement plans can be easily rolled into either a variety of mutual funds, stocks,
bonds within a roth IRA, rollover IRA, or existing contributory IRA account, provided that you have separated service with the company where the plan is held.

However, there may be some costs to do this, as well as other ongoing expenses that
should be considered as well. In addition, there may be surrender charges when you want to move
some or part of your money as well. Check with your Financial Advisor and read the
prospectus regarding any investments you might be considering to insure that you aren’t hit with any type of penalty or fee.

What are your OPTIONS when dealing with former 401k plans?

1. You can move/rollover, all or PART, of your 401k into a rollover IRA account.

2. You can move/rollover, all or PART, of your 401k into your next employer’s 401k or retirement plan.

3. You can move/rollover, all or PART, of your 401k into a Roth IRA if you are in an income bracket that will be able to let you do so.

4. You can leave the funds with your past employer’s plan.

5. You can do any of the above while taking a full or partial distribution from your plan. Please keep in mind that this will trigger a taxable event of your income tax bracket, plus a 10% early withdrawal penalty on the amount that is taken.

NOTE: Most 401k plan administrators do NOT allow partial rollovers. It’s all or nothing
in most cases. However, if you want to move your retirement money into more than one
place, please contact a qualified advisor to assist you with this transaction.

There are virtually unlimited numbers of possible combinations. It takes the
experience of a knowledgeable Financial Advisor to know what is best in each particular
scenario. Everyone is different and so are their needs and desires! Please log onto our site at www.erollover.com to find an advisor or service that can cater directly to your needs.

We also go further in depth on our blog and site with regard to the types of investments available, and which ones may suit you best. Please read the following article, Mutual Funds vs. Stocks, EFT’s, and Bonds, to get a better feel for these vehicles, and which may be best for your situation.

Please visit our site for more Retirement, 401k, and Insurance details:
www.erollover.com

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