What is a "ROLLOVER into an IRA"?
Generally,
after a person leaves the employ of a company, they are given the
option to
roll their 401K
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 or
into either a Fixed IRA annuity or an
Indexed IRA annuity or a
variable annuity.
However,
there may be some costs to do this. There may be other ongoing costs
that
should be
considered as well. 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.
What
are your OPTIONS when doing a ROLLOVER?
1.
You can move/rollover, all or PART, of your 401k into one, or
more IRA's.
2.
You can move/rollover, all or PART, of your 401k into one, or
more companies
and
multiple IRA's..
3.
You can move/rollover, all or PART, of your 401k into one, or
more IRA
mutual
funds and/or IRA annuities.
4.
You can move/rollover, all or PART, of your 401k into stocks
within an IRA
account.
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 I’d
be pleased to show you a way to do it.
Just ask!
There is
an almost unlimited number of possible combinations possible. 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!
E-MAIL me if you like
and we can
discuss YOUR SPECIFIC NEEDS!
Got
a Question?
§
NOTE: All
Guarantees are based on the financial strength and claims paying
abilities
of the
company chosen for your annuity. Feel free to contact
me for
more
detailed information.
457
PLAN "Rollovers"!
What are 457 plans? City, state, local and most any
governmental qualified deferred
compensation plans. YES, as of January 1st, 2002 (due
to the 2001 Tax Reconciliation
Act) may also be rolled into an IRA. AFTER YOU
LEAVE THEIR EMPLOYMENT!
I said ALMOST. You have to check with your
plan administrator and have them check
the "WORDING" of your specific plan (they differ
widely). But in most cases, these plans
can be rolled into an IRA for potentially increased
investing options and continued
tax-deferred growth, distributions and possibly better
control
Taking CONTROL
of your 403(b)!
What is
a 9024 transfer?
NOTE: Generally,
individuals "currently employed" cannot move their retirement plan
to
another company/administrator,
or to an IRA; however, some major companies do
permit
active 403(b) participants to roll all or part of their 403(b) money
into an individual
private
IRA.
Also note
that those who have 403(b)'s (also commonly called TSA
accounts) may be
able to
MOVE their plans almost anytime they desire (even if still
currently employed
with their
employer). It's very easy to ROLL a 403(b) (which is a variable
annuity in
most
cases already, into a PRIVATE IRA Variable Annuity,
which may offer
more
investment
options and control BY YOU, the 403(b)/IRA owner. NOTE:
once you roll
(convert)
a 403(b) into an IRA. You can not make future contributions to
the new
IRA plan
but you can continue making contributions to the OLD 403(b) plan, if
desired.
What
are your OPTIONS?
Cash it
in! (Pay the
income taxes on any amount withdrawn and kept,
PLUS,
if you are under age
59 1/2 there will be the additional 10% IRS early
withdrawal
penalty mentioned above.)
See 72t for a way to
avoid this additional 10% early withdrawal penalty.
Move it-
to a NEW employers 401k plan. (If that is allowed.) You may be
better off
rolling it into a
private 403(b) or an IRA. However, it must be noted that
IRA's do
not have the ability to take loans against those funds. For this
reason, often
people
choose to move their old 403(b) money into a new employers 401k plan
which may
allow loans. This would then allow them to make loans on their
retirement
money, if
needed. Some do, some don't! Check with your plan administrator
before
making
any changes.
A
ROLLOVER! (as detailed in this article)
is often the most preferred
option of
all....
NOTE: annuities are NOT used for their tax-deferred
growth when combined
with an IRA. There
are many other reasons (as described here) for using an
annuity, since an IRA already offers
tax-deferred growth without the use of an
annuity.
