How To Rollover 401k To IRA
Here are some suggestions and considerations when looking into rolling over your 401k into an individual retirement account.
The first step rolling over a 401k into an IRA is receiving a distribution from your 401k, and taking care of those aspects with the HR or payroll department of your current , or perhaps now ex-employer where the plan is, and potentially through the company through which they set up the retirement plan.
Next you will need to decide on where you want to open an IRA and you will be selecting an IRA custodian. Now remember that when rolling over your plan, you are responsible to make sure that the funds are deposited within 60 days to avoid penalties.
Another aspect to think about ahead of time is which types of investment options you are looking to put your money into, as of course there is the option of physical precious metals in certain types of individual retirement accounts, where you can invest in platinum, silver, palladium and gold coins and bars of certain standards.
Types of IRAs
You may also even consider the types of IRAs available, such as a traditional or Roth. Whether or not precious metals are of interest, and in that case it would be a self-directed IRA, and that may be of interest to you as well, and worthy of looking into.
Hopefully this gave you some insight. This video below shows some nice points you should think about when looking into rolling over your 401k into an IRA.
In this video below Jeff Rose, a certified financial planner, offers some benefits for your consideration with this type of arrangement.
A couple points he hits upon are:
The additional investment selections available to you with an IRA, as a 401k typically has pre-selected investment choices that you may choose from, and they are usually limited to 10 or so.
He points out how you can invest into a whole bunch of other investments such as stocks.
Jeff also suggests that opening an IRA can simplify your life so to speak, as you have more options within one IRA, where some investors opted for that through multiple 401k plans.
Retirement Income Control
Another point he mentions is a certain level of control over your retirement income that is not available with the same flexibility in a typical 401k.
Flexibility With Required Minimum Distributions
He also mentions how when you reach age 70 1/2, you need to receive the required minimum distributions, and with an individual retirement account, you have say over which investments you can liquidate, or even potentially remove from the account. Whereas with a 401k, you are more restricted with these distributions.