Why and when should I rollover my 401k and how do I do it?
Most employer retirement plans have fairly limited investment options available to employees. These limitations protect the employer from liability. From the employee's standpoint, such narrow investment choices may limit your ability to reach your retirement goal. By rolling your 401(k) to an IRA in your name you can further diversify your portfolio in accordance with your goals or help sustain it through a rocky market.
Sometimes it might be advisable to roll your 401(k) to your new employers plan or leave your 401(k) at your former employer altogether (there are new rules that allow you to withdraw money from your 401(k) between age 55 and 59 ½ without incurring the 10% early withdrawal penalty). You should always check with your advisor before initiating a rollover to make sure that a rollover is appropriate given your specific circumstances.
To initiate a rollover you need to get "rollover/distribution" paperwork from your former employer, open an IRA account at the custodian of your choosing, and complete the rollover paperwork showing the account number and custodian of the new IRA account. Please request that your former custodian send the check for your IRA rollover to SHJ so that we can ensure it gets sent to the proper custodian and deposited to your IRA account in a timely manner. You can avoid taxes by opting for a direct rollover (aka Trustee to Trustee transfer).
Back to FAQ