A 401(k) rollover is one of the first considerations you should have when you are changing jobs. After all, you worked hard to put that money away and the last thing you want to do is have the money sit dormant simply because you no longer work for a particular company. However, you have options with your 401(k) rollover and because of this there are three considerations you need to take into account before you start the rollover process.
1. Type of IRA: The first consideration that you should make with your 401(k) rollover is what type of IRA you will rollover the funds into. You can choose a standard IRA, a ROTH IRA, or a checkbook IRA. While a checkbook IRA is less well-known when compared with standard and ROTH IRAs, it does comes with the privilege of check writing, which means you have total control over when to invest in something. Additionally, you can choose from a wider range of investment including real estate and physical gold and/or silver.
2. Speed of Rollover: Many people simply rollover their 401(k) and think that it is instantaneous. The entire process can take up to 60 days or longer, but you can do several things to expedite the 401(k) rollover process. You can first notify the retirement plan administrator that a rollover will be coming soon and find out what needs to be done on your part. This will include liquidating all assets to cash so the transfer doesn’t have to wait on any settlement dates, which will only prolong the process.
3. Fees: Depending on the IRA facilitator that you use to rollover your 401(k) and what type of IRA you rollover your funds into there may or may not be fees involved. What shouldn’t be overlooked are the possible fees that your 401(k) plan might require you to pay upon exiting. It is best to learn in advance what all your fees will be and what your options are for paying those fees.
The most important step to take when planning your 401(k) rollover is action. You will want to get the rollover taken care of in the fastest manner possible so you can continue to plan for your retirement. Whether or not that will include an IRA that has more choices and even check writing privileges will be up to you. But, the sooner you plan the better so waste no time in doing your due diligence and develop a rollover 401(k) that works for your needs and your situation.
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