Many employers maintain 401k retirement savings accounts for their employees—an attractive employee benefit. But in the event that an employee leaves the job, what happens to their 401k savings? At Harvest Wealth Partners, we can answer all of your questions about retirement planning, including the Schererville 401k rollover process. To learn more about Schererville 401k rollover and how we can help, reach out to our team directly.
A 401k, sometimes written as 401(k), is a company-sponsored retirement savings plan. With a 401k, an employee will choose to have a portion of their paycheck automatically allocated in the 401k plan; then, the employer may choose to match all or a part of that contribution. 401ks are tax-advantaged accounts, but they have contribution limits per year. A 403b is the non-profit version of a 401k.
When a person leaves a job, they no longer have the ability to make contributions to their 401k, and surely their former employer will cease making contributions as well. As such, the employee has a few options for managing their 401k, including:
If your new employer offers a 401k, this can be a great option. Cashing out a 401k is never recommended. You will have to pay taxes on the cashed-out amount. More than this though, retirement savings are meant to grow over time.
For some people, rolling over a 401(k) may be the best option. By rolling over a 401k, you’ll avoid tax penalties and your retirement savings may continue to grow tax-deferred. Rolling over a 401k into an IRA may also provide you with more investment choices, lower fees and costs, fewer rules, estate planning advantages, and the option to convert your IRA to a Roth account.
While a 401k rollover may be the right choice for some people, what’s best for you can vary depending on your circumstances and your retirement savings goals. When you work with our retirement planning professionals at Harvest Wealth Partners, we’ll guide you through retirement savings options, talk you through the different choices you have when you leave your old employer and your employer-managed 401k plan, and help you to understand how much money you may need for retirement and the best savings strategies to get there. We can also handle the transfer and rollover of all retirement accounts.
Thinking about retirement can be daunting and overwhelming, but there’s no bad time to start planning for the future. At Harvest Wealth Partners, our retirement planning professionals offer Schererville 401k rollover services, as well as a wide range of other retirement planning services. To learn more about how to create a sound retirement plan that works for you, your retirement savings options, and how our retirement planning professionals can help, reach out to us directly by phone or online today.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. To determine which strategies or investments may be suitable for you, consult the appropriate qualified professional prior to making a decision.
Traditional IRA account owners have considerations to make before performing a Roth IRA conversion. These primarily include income tax consequences on the converted amount in the year of conversion, withdrawal limitations from a Roth IRA, and income limitations for future contributions to a Roth IRA. In addition, if you are required to take a required minimum distribution (RMD) in the year you convert, you must do so before converting to a Roth IRA.
This material was prepared for Harvest Wealth Partners’s financial advisor use.
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