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Top 3 Reasons to Rollover a 401(k)

Top 3 Reasons to Rollover a 401(k)

401(k) Rollover: A process to move funds from a 401(k) to another retirement plan without a tax cost. (Also pertinent for 403(b) and 457 plans)

1. Sanity
Juggling multiple accounts is inconvenient and makes it more difficult to manage basic investing practices, such as having the right balance between stocks and bonds.

2. Lower expenses
401(k) plans cost more to run than Individual Retirement Accounts (“IRAs”). Some employers bury these expenses in the employee’s 401(k) performance, while other employers pay those expenses themselves.

3. Flexibility
From investments to tax issues, IRAs have significantly more flexibility. Also, IRAs afford you the opportunity to have multiple beneficiaries for estate planning; and with a special rule, you can also withdrawal money prior to age 59 ½.

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