Pros and Cons of Rolling Over Your 401(k) to an IRA
Changing jobs and deciding what to do with the money in your current 401(k) plan can feel tricky. Your current employer may allow you to leave it where it is, or you can roll it over into your new company's employer-sponsored 401(k). Or you can skip employer-sponsored plans altogether and roll over the money into an individual retirement account (IRA).No single type of retirement plan is right for everyone, making it more important to identify what's of value to you, as an investor. If you're wondering about rolling over a 401(k) into an IRA, here are some of the pros and cons worth considering. Most 401(k) plans have an impressive lineup of stock funds but fewer bond options. Considering the primary goal of a 401(k) is to accumulate as much as possible before retirement, this strategy makes perfect sense. However, you may want to shift into a retirement plan with more room for bonds as you approach retirement. Continue reading
Changing jobs and deciding what to do with the money in your current 401(k) plan can feel tricky. Your current employer may allow you to leave it where it is, or you can roll it over into your new company's employer-sponsored 401(k). Or you can skip employer-sponsored plans altogether and roll over the money into an individual retirement account (IRA).
No single type of retirement plan is right for everyone, making it more important to identify what's of value to you, as an investor. If you're wondering about rolling over a 401(k) into an IRA, here are some of the pros and cons worth considering.
Most 401(k) plans have an impressive lineup of stock funds but fewer bond options. Considering the primary goal of a 401(k) is to accumulate as much as possible before retirement, this strategy makes perfect sense. However, you may want to shift into a retirement plan with more room for bonds as you approach retirement.